UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): NOVEMBER 2, 2006 ------------------------------ CENTERPOINT ENERGY, INC. (Exact name of registrant as specified in its charter) TEXAS 1-31447 74-0694415 (State or other jurisdiction (Commission File Number) (IRS Employer of incorporation) Identification No.) 1111 LOUISIANA HOUSTON, TEXAS 77002 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (713) 207-1111 ------------------------------ Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [_] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [_] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [_] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [_] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION. On November 2, 2006, CenterPoint Energy, Inc. ("CenterPoint Energy") reported third quarter 2006 earnings. For additional information regarding CenterPoint Energy's third quarter 2006 earnings, please refer to CenterPoint Energy's press release attached to this report as Exhibit 99.1 (the "Press Release"), which Press Release is incorporated by reference herein. The information in the Press Release is being furnished, not filed, pursuant to Item 2.02. Accordingly, the information in the Press Release will not be incorporated by reference into any registration statement filed by CenterPoint Energy under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference. ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS. The exhibit listed below is furnished pursuant to Item 2.02 of this Form 8-K. (d) Exhibits. 99.1 Press Release issued November 2, 2006 regarding CenterPoint Energy, Inc.'s third quarter 2006 earnings.
SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. CENTERPOINT ENERGY, INC. Date: November 2, 2006 By: /s/ James S. Brian --------------------------- James S. Brian Senior Vice President and Chief Accounting Officer
EXHIBIT INDEX EXHIBIT NUMBER EXHIBIT DESCRIPTION - -------------- ------------------- 99.1 Press Release issued November 2, 2006 regarding CenterPoint Energy, Inc.'s third quarter 2006 earnings
EXHIBIT 99.1 (CENTERPOINT ENERGY LOGO) For more information contact MEDIA: LETICIA LOWE Phone 713.207.7702 INVESTORS: MARIANNE PAULSEN Phone 713.207.6500 FOR IMMEDIATE RELEASE Page 1 of 5 ________________________________________________________________________________ CENTERPOINT ENERGY REPORTS THIRD QUARTER 2006 EARNINGS HOUSTON, TX -- NOVEMBER 2, 2006 - CenterPoint Energy, Inc. (NYSE: CNP) today reported net income and income from continuing operations of $83 million, or $0.26 per diluted share, for the third quarter of 2006 compared to $50 million, or $0.15 per diluted share, for the same period of 2005. "I'm pleased with the overall performance of our business and the progress that we are achieving," said David M. McClanahan, president and chief executive officer of CenterPoint Energy. "This continued strong performance, combined with the growth prospects in our pipeline and field services operations, positions us well for the future." For the nine months ended September 30, 2006, net income was $365 million, or $1.14 per diluted share, compared to $171 million, or $0.51 per diluted share, for the same period of 2005. Income from continuing operations before extraordinary item for the nine months ended September 30, 2006, was also $365 million, or $1.14 per diluted share, compared to $144 million, or $0.43 per diluted share, for the same period of 2005. Results for the nine months ended September 30, 2006, included the impact of two second quarter settlements. The first was an agreement with the Internal Revenue Service regarding the tax treatment of the company's Zero Premium Exchangeable Subordinated Notes (ZENS) and its former Automatic Common Exchange Securities (ACES). This agreement, which is subject to approval by the Joint Committee on Taxation of the U. S. Congress, resulted in a reduction to the company's previously accrued tax and related interest reserves, adding $119 million ($0.37 per diluted share) to income. The second was an agreement settling all issues related to the remand to the Texas Public Utility Commission of the company's 2001 unbundled cost of service order (UCOS) which reduced income by $21 million after-tax, or $0.07 per diluted share. Net income for the nine months ended September 30, 2005, included an extraordinary gain of $30 million, or $0.09 per diluted share, reflecting an adjustment to the extraordinary loss recorded in the second half of 2004 to write down generation-related regulatory assets. In addition, net income for the nine months ended September 30, 2005, included a loss of $3 million, or $0.01 per diluted share, from discontinued operations. - more-
(CENTERPOINT ENERGY LOGO) For more information contact MEDIA: LETICIA LOWE Phone 713.207.7702 INVESTORS: MARIANNE PAULSEN Phone 713.207.6500 FOR IMMEDIATE RELEASE Page 2 of 5 ________________________________________________________________________________ OPERATING INCOME BY SEGMENT DETAILED ELECTRIC TRANSMISSION & DISTRIBUTION The electric transmission & distribution segment reported operating income of $219 million in the third quarter of 2006, consisting of $187 million for the regulated electric transmission & distribution utility (TDU) (including $14 million for the competition transition charge (CTC)) and $32 million related to the transition bonds. Operating income for the third quarter of 2005 totaled $183 million, consisting of $174 million for the TDU (including $2 million for the CTC) and $9 million related to the transition bonds. The TDU's revenues continued to benefit from solid customer growth, with nearly 49,000 metered customers added since September 2005. Houston experienced normal weather during the third quarter of 2006, which created an unfavorable weather variance when compared to the abnormally warm weather in 2005. Operation and maintenance expenses were unchanged. Operating income for the nine months ended September 30, 2006, was $480 million, consisting of $384 million for the TDU (including $44 million for the CTC) and $96 million related to the transition bonds. Operating income for the same period of 2005 totaled $385 million, consisting of $358 million for the TDU (including $2 million for the CTC) and $27 million related to the transition bonds. The TDU's operating income for the nine months ended September 30, 2006, includes the $32 million adverse impact of the resolution of the 2001 UCOS order recorded in the second quarter of 2006. NATURAL GAS DISTRIBUTION The natural gas distribution segment reported an operating loss of $11 million for the third quarter of 2006 compared to a loss of $16 million for the same period of 2005. Due to seasonal impacts, the third quarter for this segment is typically one of the weakest of the year. Higher margins from rate increases and rate design changes, along with the addition of nearly 43,000 customers since September 2005, were partially offset by increased operation and maintenance expenses driven primarily by higher bad debt expense due to high natural gas prices. Operating income for the nine months ended September 30, 2006, was $90 million compared to $116 million for the same period of 2005. In addition to the factors noted above, operating income for the nine months ended September 30, 2006, was adversely affected by unfavorable weather, decreased usage and costs associated with staff reductions. - more -
(CENTERPOINT ENERGY LOGO) For more information contact MEDIA: LETICIA LOWE Phone 713.207.7702 INVESTORS: MARIANNE PAULSEN Phone 713.207.6500 FOR IMMEDIATE RELEASE Page 3 of 5 ________________________________________________________________________________ COMPETITIVE NATURAL GAS SALES AND SERVICES The competitive natural gas sales and services segment reported operating income of $12 million for the third quarter of 2006 compared to $4 million for the same period of 2005. The increase was primarily driven by increased sales of gas from inventory, reduced bad debt expenses and a $21 million favorable variance related to mark-to-market accounting for non-trading financial derivatives used to lock in the economic value associated with basis differentials. These positive variances were partially offset by a $26 million write-down of natural gas inventory to the lower of average cost or market. The company purchases and stores natural gas to meet certain future sales requirements and enters into derivative contracts to hedge the economic value of the future sales. Due to the inventory write-downs, operating income in the future periods, when these sales occur, is expected to be higher. Operating income for the nine months ended September 30, 2006, was $44 million compared to $30 million for the same period of 2005. Operating income for the nine months ended September 30, 2006, included improved margins, a $34 million favorable variance related to mark-to-market accounting and $56 million of write-downs of natural gas inventory. PIPELINES AND FIELD SERVICES The pipelines and field services segment reported operating income of $69 million for the third quarter of 2006 compared to $52 million for the same period of 2005. This segment's businesses continue to benefit from favorable dynamics in the markets for natural gas gathering and transportation services in the Gulf Coast and Mid-Continent regions. Within this segment, the pipeline business achieved higher operating income ($48 million vs. $36 million) resulting primarily from the sale of excess gas no longer required following improvements to a storage facility. The field services business achieved higher operating income ($21 million vs. $16 million) driven by increased throughput. In addition, this business recorded equity income of $2 million in the third quarter of 2006 ($1 million for the same period in 2005) from its 50 percent interest in a jointly-owned gas processing plant. These amounts are included in Other -- net under the Other Income (Expense) caption. Operating income for the nine months ended September 30, 2006, was $203 million compared to $168 million for the same period of 2005. The pipeline business achieved operating income of $137 million for the nine months ended September 30, 2006, compared to $119 million for the same period of 2005. The field services business achieved operating income of $66 million for the nine months ended September 30, 2006, compared to $49 million for the same period of 2005. Equity income from the jointly-owned gas processing plant was $7 million for the nine months ended September 30, 2006, compared to $4 million for the same period of 2005. - more -
(CENTERPOINT ENERGY LOGO) For more information contact MEDIA: LETICIA LOWE Phone 713.207.7702 INVESTORS: MARIANNE PAULSEN Phone 713.207.6500 FOR IMMEDIATE RELEASE Page 4 of 5 ________________________________________________________________________________ DIVIDEND DECLARATION On October 26, 2006, CenterPoint Energy's board of directors declared a regular quarterly cash dividend of $0.15 per share of common stock payable on December 8, 2006, to shareholders of record as of the close of business on November 16, 2006. OUTLOOK FOR 2006 CenterPoint Energy expects diluted earnings per share for 2006 to be in the range of $1.00 to $1.10 compared to its prior expectation of $0.90 to $1.00. This guidance excludes any impacts related to the ZENS and ACES, including the negative impact of $0.04 per diluted share related to the increase in the tax reserve recorded in the first quarter 2006 and the one-time positive impact of $0.37 per diluted share related to the company's settlement regarding the tax treatment of the ZENS and ACES recorded in the second quarter 2006. This guidance also excludes the one-time adverse impact of $0.07 per diluted share related to the settlement of the 2001 UCOS order recorded in the second quarter 2006. This guidance includes an estimated impact of the settlement of the TDU's rate case and takes into consideration various economic and operational assumptions related to the business segments in which the company operates. The company has made certain assumptions regarding the impact to earnings of various other regulatory proceedings, but cannot predict the ultimate outcome of any of those proceedings. In providing this guidance, the company has not projected the impact of any changes in accounting standards, any impact from acquisitions or divestitures, or the outcome of the TDU's true-up appeal. WEBCAST OF EARNINGS CONFERENCE CALL CenterPoint Energy's management will host an earnings conference call on Thursday, November 2, 2006, at 10:30 a.m. Central time or 11:30 a.m. Eastern time. Interested parties may listen to a live audio broadcast of the conference call at www.CenterPointEnergy.com/investors/events. A replay of the call can be accessed approximately two hours after the completion of the call and will be archived on the web site for at least one year. CenterPoint Energy, Inc., headquartered in Houston, Texas, is a domestic energy delivery company that includes electric transmission & distribution, natural gas distribution, competitive natural gas sales and services, and pipeline and field services operations. The company serves more than five million metered customers primarily in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma, and Texas. Assets total approximately $17 billion. With about 9,000 employees, CenterPoint Energy and its predecessor companies have been in business for more than 130 years. For more information, visit the Web site at www.CenterPointEnergy.com. - more -
(CENTERPOINT ENERGY LOGO) For more information contact MEDIA: LETICIA LOWE Phone 713.207.7702 INVESTORS: MARIANNE PAULSEN Phone 713.207.6500 FOR IMMEDIATE RELEASE Page 5 of 5 _______________________________________________________________________________ This news release includes forward-looking statements. Actual events and results may differ materially from those projected. The statements in this news release regarding future financial performance and results of operations and other statements that are not historical facts are forward-looking statements. Factors that could affect actual results include the timing and outcome of appeals from the true-up proceedings, the timing and impact of future regulatory, legislative and IRS decisions, effects of competition, weather variations, changes in CenterPoint Energy's or its subsidiaries' business plans, financial market conditions, the timing and extent of changes in commodity prices, particularly natural gas, the impact of unplanned facility outages, and other factors discussed in CenterPoint Energy's and its subsidiaries' Form 10-Ks for the period ended December 31, 2005, Form 10-Qs for the periods ended March 31, 2006, June 30, 2006, and September 30, 2006, and other filings with the Securities and Exchange Commission. ###
Energy, Inc. and Subsidiaries Statements of Consolidated Income (Millions of Dollars) (Unaudited) Quarter Ended September 30, Nine Months Ended September 30, --------------------------------- --------------------------------- 2005 2006 2005 2006 --------------- ---------------- -------------- ----------------- Revenues: Electric Transmission & Distribution $ 484 $ 533 $ 1,243 $ 1,374 Natural Gas Distribution 535 485 2,405 2,514 Competitive Natural Gas Sales and Services 1,013 830 2,783 2,743 Pipelines and Field Services 116 141 362 401 Other Operations 4 3 15 12 Eliminations (79) (57) (298) (189) --------------- ---------------- -------------- ----------------- Total 2,073 1,935 6,510 6,855 --------------- ---------------- -------------- ----------------- Expenses: Natural gas 1,277 1,058 4,161 4,286 Operation and maintenance 336 347 974 1,018 Depreciation and amortization 145 159 411 452 Taxes other than income taxes 90 87 277 289 --------------- ---------------- -------------- ----------------- Total 1,848 1,651 5,823 6,045 --------------- ---------------- -------------- ----------------- Operating Income 225 284 687 810 --------------- ---------------- -------------- ----------------- Other Income (Expense) : Gain (Loss) on Time Warner investment 30 20 (29) 17 Gain (Loss) on indexed debt securities (29) (12) 34 (13) Interest and other finance charges (168) (120) (521) (353) Interest on transition bonds (9) (32) (27) (98) Return on true-up balance 35 - 104 - Other - net 7 12 18 27 --------------- ---------------- -------------- ----------------- Total (134) (132) (421) (420) --------------- ---------------- -------------- ----------------- Income from Continuing Operations Before Income Taxes and Extraordinary Item 91 152 266 390 Income Tax Expense (41) (69) (122) (25) --------------- ---------------- -------------- ----------------- Income from Continuing Operations Before Extraordinary Item 50 83 144 365 --------------- ---------------- -------------- ----------------- Discontinued Operations: Income from Texas Genco, net of tax - - 11 - Loss on Disposal of Texas Genco, net of tax - - (14) - --------------- ---------------- -------------- ----------------- Total - - (3) - --------------- ---------------- -------------- ----------------- Income Before Extraordinary Item 50 83 141 365 Extraordinary Item, net of tax - - 30 - --------------- ---------------- -------------- ----------------- Net Income $ 50 $ 83 $ 171 $ 365 =============== ================ ============== ================= Reference is made to the Notes to the Consolidated Financial Statements contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.
CenterPoint Energy, Inc. and Subsidiaries Selected Data From Statements of Consolidated Income (Millions of Dollars, Except Share and Per Share Amounts) (Unaudited) Quarter Ended Nine Months Ended September 30, September 30, -------------------------------- ----------------------------------- 2005 2006 2005 2006 --------------- --------------- ---------------- ----------------- Basic Earnings Per Common Share: Income from Continuing Operations $ 0.16 $ 0.27 $ 0.46 $ 1.17 Income from Discontinued Operations - - (0.01) - Extraordinary item, net of tax - - 0.10 - --------------- --------------- ---------------- ----------------- Net Income $ 0.16 $ 0.27 $ 0.55 $ 1.17 =============== =============== ================ ================= Diluted Earnings Per Common Share: Income from Continuing Operations $ 0.15 $ 0.26 $ 0.43 $ 1.14 Income from Discontinued Operations - - (0.01) - Extraordinary item, net of tax - - 0.09 - --------------- --------------- ---------------- ----------------- Net Income $ 0.15 $ 0.26 $ 0.51 $ 1.14 =============== =============== ================ ================= Dividends Declared per Common Share $ 0.07 $ 0.15 $ 0.34 $ 0.45 Weighted Average Common Shares Outstanding (000): - Basic 309,657 311,945 309,080 311,414 - Diluted 346,503 324,716 355,022 319,974 Operating Income (Loss) by Segment Electric Transmission & Distribution: Transmission & Distribution Operations $ 174 $ 187 $ 358 $ 384 Transition Bond Companies 9 32 27 96 --------------- --------------- ---------------- ----------------- Total Electric Transmission & Distribution 183 219 385 480 Natural Gas Distribution (16) (11) 116 90 Competitive Natural Gas Sales and Services 4 12 30 44 Pipelines and Field Services 52 69 168 203 Other Operations 2 (5) (12) (7) --------------- --------------- ---------------- ----------------- Total $ 225 $ 284 $ 687 $ 810 =============== =============== ================ ================= Reference is made to the Notes to the Consolidated Financial Statements contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.
CenterPoint Energy, Inc. and Subsidiaries Results of Operations by Segment (Millions of Dollars) (Unaudited) ELECTRIC TRANSMISSION & DISTRIBUTION -------------------------------------------------------------------------------------- Quarter Ended Nine Months Ended September 30, September 30, ----------------------------- % Diff ----------------------------- % Diff 2005 2006 Fav/(Unfav) 2005 2006 Fav/(Unfav) ------------- -------------- ----------- ------------- -------------- ----------- RESULTS OF OPERATIONS: Revenues: Electric transmission and distribution utility $ 453 $ 453 - $ 1,164 $ 1,170 1% Transition bond companies 31 80 158% 79 204 158% ------------- -------------- ------------- -------------- Total 484 533 10% 1,243 1,374 11% ------------- -------------- ------------- -------------- Expenses: Operation and maintenance 155 155 - 446 436 2% Depreciation and amortization 69 58 16% 197 182 8% Taxes other than income taxes 55 53 4% 163 168 (3%) Transition bond companies 22 48 (118%) 52 108 (108%) ------------- -------------- ------------- -------------- Total 301 314 (4%) 858 894 (4%) ------------- -------------- ------------- -------------- Operating Income $ 183 $ 219 20% $ 385 $ 480 25% ============= ============== ============= ============== Operating Income - Electric transmission and distribution utility 174 187 7% 358 384 7% Operating Income - Transition bond companies 9 32 256% 27 96 256% ------------- -------------- ------------- -------------- Total Segment Operating Income $ 183 $ 219 20% $ 385 $ 480 25% ============= ============== ============= ============== ELECTRIC TRANSMISSION & DISTRIBUTION OPERATING DATA: ACTUAL MWH DELIVERED Residential 8,871,356 8,522,786 (4%) 19,606,915 19,317,160 (1%) Total 22,351,407 22,829,685 2% 57,134,034 59,238,907 4% WEATHER (AVERAGE FOR SERVICE AREA): Percentage of normal: Cooling degree days 113% 100% (13%) 110% 105% (5%) Heating degree days 0% 0% 0% 76% 60% (16%) AVERAGE NUMBER OF METERED CUSTOMERS: Residential 1,690,819 1,740,079 3% 1,675,904 1,729,348 3% Total 1,921,594 1,976,559 3% 1,904,235 1,964,189 3% NATURAL GAS DISTRIBUTION -------------------------------------------------------------------------------------- Quarter Ended Nine Months Ended September 30, September 30, ----------------------------- % Diff ----------------------------- % Diff 2005 2006 Fav/(Unfav) 2005 2006 Fav/(Unfav) ------------- -------------- ----------- ------------- -------------- ----------- RESULTS OF OPERATIONS: Revenues $ 535 $ 485 (9%) $ 2,405 $ 2,514 5% ------------- -------------- ------------- -------------- Expenses: Natural gas 355 298 16% 1,693 1,787 (6%) Operation and maintenance 132 137 (4%) 393 429 (9%) Depreciation and amortization 39 38 3% 115 113 2% Taxes other than income taxes 25 23 8% 88 95 (8%) ------------- -------------- ------------- -------------- Total 551 496 10% 2,289 2,424 (6%) ------------- -------------- ------------- -------------- Operating Income (Loss) $ (16) $ (11) 31% $ 116 $ 90 (22%) ============= ============== ============= ============== NATURAL GAS DISTRIBUTION OPERATING DATA: THROUGHPUT DATA IN BCF Residential 9 14 56% 107 98 (8%) Commercial and Industrial 38 44 16% 158 160 1% ------------- -------------- ------------- -------------- Total Throughput 47 58 23% 265 258 (3%) ============= ============== ============= ============== WEATHER (AVERAGE FOR SERVICE AREA) Percentage of normal: Heating degree days 34% 104% 70% 89% 81% (8%) AVERAGE NUMBER OF CUSTOMERS: Residential 2,820,629 2,849,040 1% 2,835,306 2,864,999 1% Commercial and Industrial 244,249 253,063 4% 246,370 253,357 3% ------------- -------------- ------------- -------------- Total 3,064,878 3,102,103 1% 3,081,676 3,118,356 1% ============= ============== ============= ============== Reference is made to the Notes to the Consolidated Financial Statements contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.
CenterPoint Energy, Inc. and Subsidiaries Results of Operations by Segment (Millions of Dollars) (Unaudited) COMPETITIVE NATURAL GAS SALES AND SERVICES ------------------------------------------------------------------------------------ Quarter Ended Nine Months Ended September 30, September 30, ---------------------------- % Diff -------------------------- % Diff 2005 2006 Fav/(Unfav) 2005 2006 Fav/(Unfav) ------------- ------------- ------------ ------------ ------------ ------------ RESULTS OF OPERATIONS: Revenues $ 1,013 $ 830 (18%) $ 2,783 $ 2,743 (1%) ------------- ------------- ------------ ------------ Expenses: Natural gas 998 809 19% 2,728 2,673 2% Operation and maintenance 9 8 11% 21 23 (10%) Depreciation and amortization - - - 1 1 - Taxes other than income taxes 2 1 50% 3 2 33% ------------- ------------- ------------ ------------ Total 1,009 818 19% 2,753 2,699 2% ------------- ------------- ------------ ------------ Operating Income $ 4 $ 12 200% $ 30 $ 44 47% ============= ============= ============ ============ COMPETITIVE NATURAL GAS SALES AND SERVICES OPERATING DATA: THROUGHPUT DATA IN BCF Wholesale - third parties 81 90 11% 235 251 7% Wholesale - affiliates 11 8 (27%) 46 27 (41%) Retail 31 31 - 112 110 (2%) Pipeline 10 9 (10%) 41 28 (32%) ------------- ------------- ------------ ------------ Total Throughput 133 138 4% 434 416 (4%) ============= ============= ============ ============ AVERAGE NUMBER OF CUSTOMERS: Wholesale 144 140 (3%) 143 140 (2%) Retail 6,225 6,213 - 6,203 6,416 3% Pipeline 147 138 (6%) 154 138 (10%) ------------- ------------- ------------ ------------ Total 6,516 6,491 - 6,500 6,694 3% ============= ============= ============ ============ PIPELINES AND FIELD SERVICES ------------------------------------------------------------------------------------ Quarter Ended Nine Months Ended September 30, September 30, ---------------------------- % Diff --------------------------- % Diff 2005 2006 Fav/(Unfav) 2005 2006 Fav/(Unfav) ------------- ------------- ------------ ------------ ------------- ----------- RESULTS OF OPERATIONS: Revenues $ 116 $ 141 22% $ 362 $ 401 11% ------------- ------------- ------------ ------------ Expenses: Natural gas - 7 - 25 10 60% Operation and maintenance 47 47 - 121 136 (12%) Depreciation and amortization 12 12 - 34 36 (6%) Taxes other than income taxes 5 6 (20%) 14 16 (14%) ------------- ------------- ------------ ------------ Total 64 72 (13%) 194 198 (2%) ------------- ------------- ------------ ------------ Operating Income $ 52 $ 69 33% $ 168 $ 203 21% ============= ============= ============ ============ Operating Income - Pipeline business 36 48 33% 119 137 15% Operating Income - Field Services business 16 21 31% 49 66 35% ------------- ------------- ------------ ------------ Total Segment Operating Income $ 52 $ 69 33% $ 168 $ 203 21% ============= ============= ============ ============ PIPELINES AND FIELD SERVICES OPERATING DATA: THROUGHPUT DATA IN BCF Natural Gas Sales - 1 - 4 3 (25%) Transportation 199 204 3% 700 718 3% Gathering 92 97 5% 262 279 6% Elimination (1) (1) - (4) (2) 50% ------------- ------------- ------------ ------------ Total Throughput 290 301 4% 962 998 4% ============= ============= ============ ============ Reference is made to the Notes to the Consolidated Financial Statements contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.
CenterPoint Energy, Inc. and Subsidiaries Results of Operations by Segment (Millions of Dollars) (Unaudited) OTHER OPERATIONS ------------------------------------------------------------------------------------ Quarter Ended Nine Months Ended September 30, September 30, ---------------------------- % Diff -------------------------- % Diff 2005 2006 Fav/(Unfav) 2005 2006 Fav/(Unfav) ------------ -------------- ------------ ------------ ------------ ------------ RESULTS OF OPERATIONS: Revenues $ 4 $ 3 (25%) $ 15 $ 12 (20%) Expenses 2 8 (300%) 27 19 30% ------------ -------------- ------------- ------------ Operating Income (Loss) $ 2 $ (5) (350%) $ (12) $ (7) 42% ============ ============== ============= ============ Capital Expenditures by Segment (Millions of Dollars) (Unaudited) --------------------------------- -------------------------------- Quarter Ended Nine Months Ended September 30, September 30, --------------------------------- -------------------------------- 2005 2006 2005 2006 ---------------- --------------- --------------- --------------- CAPITAL EXPENDITURES BY SEGMENT Electric Transmission & Distribution $ 57 $ 88 $ 199 $ 278 Natural Gas Distribution 77 48 173 133 Competitive Natural Gas Sales and Services - 4 - 14 Pipelines and Field Services 55 135 108 219 Other Operations 7 4 17 18 ---------------- --------------- --------------- --------------- Total $ 196 $ 279 $ 497 $ 662 ================ =============== =============== =============== Interest Expense Detail (Millions of Dollars) (Unaudited) --------------------------------- -------------------------------- Quarter Ended Nine Months Ended September 30, September 30, --------------------------------- -------------------------------- 2005 2006 2005 2006 ---------------- --------------- --------------- --------------- INTEREST EXPENSE DETAIL Amortization of Deferred Financing Cost $ 19 $ 14 $ 58 $ 40 Capitalization of Interest Cost (1) (3) (3) (6) Transition Bond Interest Expense 9 32 27 98 Other Interest Expense 150 109 466 319 ---------------- --------------- --------------- --------------- Total Interest Expense $ 177 $ 152 $ 548 $ 451 ================ =============== =============== =============== Reference is made to the Notes to the Consolidated Financial Statements contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.
CenterPoint Energy, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (Millions of Dollars) (Unaudited) December 31, September 30, 2005 2006 ------------- ------------- ASSETS CURRENT ASSETS: Cash and cash equivalents $ 74 $ 285 Other current assets 2,817 2,281 ------------- ------------- Total current assets 2,891 2,566 ------------- ------------- PROPERTY, PLANT AND EQUIPMENT, NET 8,492 8,842 ------------- ------------- OTHER ASSETS: Goodwill 1,709 1,709 Regulatory assets 2,955 2,838 Other non-current assets 1,069 1,018 ------------- ------------- Total other assets 5,733 5,565 ------------- ------------- TOTAL ASSETS $ 17,116 $ 16,973 ============= ============= LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Current portion of transition bond long-term debt $ 73 $ 147 Current portion of other long-term debt 266 1,093 Other current liabilities 2,675 2,136 ------------- ------------- Total current liabilities 3,014 3,376 ------------- ------------- OTHER LIABILITIES: Accumulated deferred income taxes, net and investment tax credit 2,520 2,444 Regulatory liabilities 728 826 Other non-current liabilities 990 855 ------------- ------------- Total other liabilities 4,238 4,125 ------------- ------------- LONG-TERM DEBT: Transition bond 2,407 2,260 Other 6,161 5,645 ------------- ------------- Total long-term debt 8,568 7,905 ------------- ------------- SHAREHOLDERS' EQUITY 1,296 1,567 ------------- ------------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 17,116 $ 16,973 ============= ============= Reference is made to the Notes to the Consolidated Financial Statements contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.
CenterPoint Energy, Inc. and Subsidiaries Condensed Statements of Consolidated Cash Flows (Millions of Dollars) (Unaudited) Nine Months Ended September 30, ----------------------------- 2005 2006 ------------- ------------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 171 $ 365 Discontinued operations, net of tax 3 - Extraordinary item, net of tax (30) - ------------- ------------- Income from continuing operations 144 365 Adjustments to reconcile income from continuing operations to net cash provided by operating activities: Depreciation and amortization 470 489 Deferred income taxes and investment tax credit 156 (87) Tax and interest reserves reductions related to ZENS and ACES - (119) Write-down of natural gas inventory - 56 Changes in net regulatory assets (166) 65 Changes in other assets and liabilities (295) (48) Other, net 4 7 ------------- ------------- NET CASH PROVIDED BY OPERATING ACTIVITIES OF CONTINUING OPERATIONS 313 728 NET CASH USED IN OPERATING ACTIVITIES OF DISCONTINUED OPERATIONS (38) - ------------- ------------- NET CASH PROVIDED BY OPERATING ACTIVITIES 275 728 NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES 218 (626) NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES (496) 109 ------------- ------------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (3) 211 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 165 74 ------------- ------------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 162 $ 285 ============= ============= Reference is made to the Notes to the Consolidated Financial Statements contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.