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): February 29, 2012

 

 

CENTERPOINT ENERGY, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Texas		1-31447		74-0694415
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer 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))

 

 

 

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ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On February 29, 2012, CenterPoint Energy, Inc. (“CenterPoint Energy”) reported fourth quarter and full year 2011 earnings. For additional information regarding CenterPoint Energy’s fourth quarter and full year 2011 earnings, please refer to CenterPoint Energy’s press release attached to this report as Exhibit 99.1 (the “Press Release”) and the supplemental materials which are being posted on CenterPoint Energy’s website and are attached to this report as Exhibit 99.2 (the “Supplemental Materials”), which Press Release and Supplemental Materials are incorporated by reference herein. The information in the Press Release and Supplemental Materials is being furnished, not filed, pursuant to Item 2.02. Accordingly, the information in the Press Release and Supplemental Materials 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 exhibits listed below are furnished pursuant to Item 2.02 of this Form 8-K.

 

(d)

Exhibits.

 

99.1

Press Release issued February 29, 2012 regarding CenterPoint Energy, Inc.’s fourth quarter and full year 2011 earnings.

 

99.2

Supplemental Materials regarding CenterPoint Energy, Inc.’s fourth quarter and full year 2011 earnings.

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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: February 29, 2012				By:		/s/ Walter L. Fitzgerald
						Walter L. Fitzgerald
						Senior Vice President and Chief Accounting Officer

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EXHIBIT INDEX

 

EXHIBIT NUMBER		EXHIBIT DESCRIPTION
99.1		Press Release issued February 29, 2012 regarding CenterPoint Energy, Inc.’s fourth quarter and full year 2011 earnings.
99.2		Supplemental Materials regarding CenterPoint Energy, Inc.’s fourth quarter and full year 2011 earnings.

Exhibit 99.1

 

		For more information contact Media: Leticia Lowe Phone 713.207.7702 Investors: Marianne Paulsen Phone 713.207.6500
For Immediate Release		Page 1 of 6

 

 

CENTERPOINT ENERGY REPORTS FOURTH QUARTER AND

FULL YEAR 2011 EARNINGS

Houston, TX—February 29, 2012—CenterPoint Energy, Inc. (NYSE: CNP) today reported net income of $117 million, or $0.27 per diluted share, for the fourth quarter of 2011 compared to $124 million, or $0.29 per diluted share, for the same period of 2010. Operating income for the fourth quarter of 2011 was $274 million compared to $302 million for the same period of 2010.

For the year ended December 31, 2011, net income was $1.36 billion, or $3.17 per diluted share, compared to $442 million, or $1.07 per diluted share, for the same period of 2010. The year ended December 31, 2011, included net income of $811 million, or $1.89 per diluted share, reflecting the final resolution of the appeals of the 2004 true-up order of the Texas Public Utility Commission (Texas PUC) issued in connection with the restructuring of the Texas electric industry. Excluding this amount, net income would have been $546 million, or $1.27 per diluted share, for the year ended December 31, 2011, compared to $442 million, or $1.07 per diluted share, for the same period of 2010.

Operating income for the year ended December 31, 2011, was $1.3 billion compared to $1.25 billion for the same period of 2010.

“2011 was a significant year for our company,” said David M. McClanahan, president and chief executive officer of CenterPoint Energy. “We resolved the long-standing proceeding arising from the restructuring of the electric industry in Texas. As a result, in January 2012 we recovered approximately $1.7 billion through the issuance of securitization bonds. Operationally, our regulated electric and natural gas utilities reported solid results and our field services unit realized growth from the investments we made in several developing shale plays. We continue to look for opportunities to invest across our portfolio of electric and natural gas businesses and build value for our shareholders.”

Electric Transmission & Distribution

The electric transmission & distribution segment reported operating income of $93 million for the fourth quarter of 2011, consisting of $62 million from the regulated electric transmission & distribution utility operations (TDU) and $31 million related to securitization bonds. Operating income for the fourth quarter of 2010 was $90 million, consisting of $56 million from the TDU and $34 million related to securitization bonds. Operating income for the TDU benefited from higher net transmission revenues, timing of energy efficiency cost recovery and increased throughput primarily from growth of more than 45,000 customers since December 2010. These gains were partially offset by impacts from the recent rate case and higher operation and maintenance expenses.

 

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For Immediate Release		Page 2 of 6

 

Operating income for the year ended December 31, 2011, was $623 million, consisting of $496 million from the TDU and $127 million related to securitization bonds. Operating income for the same period of 2010 was $567 million, consisting of $427 million from the TDU and $140 million related to securitization bonds. Operating income for the TDU benefited from increased throughput driven primarily by warmer weather and customer growth, higher net transmission revenues and lower depreciation. These gains were partially offset by impacts from the recent rate case and higher operation and maintenance expenses in part due to system reliability improvements.

Natural Gas Distribution

The natural gas distribution segment reported operating income of $73 million for the fourth quarter of 2011 compared to $86 million for the same period of 2010. Operating income declined primarily as a result of higher operation and maintenance expenses.

Operating income for the year ended December 31, 2011, was $226 million compared to $231 million for the same period of 2010. Operating income declined as a result of higher operation and maintenance expenses and lower miscellaneous revenues, which were partially offset by customer growth of more than 19,000 customers since December 2010 and rate adjustments.

Interstate Pipelines

The interstate pipelines segment reported operating income of $52 million for the fourth quarter of 2011 compared to $63 million for the same period of 2010. The decline was due to lower revenues primarily related to an expired backhaul contract and lower off-system sales. These declines were partially offset by increased ancillary services.

In addition to operating income, this segment recorded equity income of $6 million for the fourth quarter of 2011 from its 50 percent interest in the Southeast Supply Header (SESH) compared to $4 million for the same period of 2010.

Operating income for the year ended December 31, 2011, was $248 million compared to $270 million for the same period of 2010. The decline was due to lower revenues primarily related to an expired backhaul contract, restructured contracts with the company’s natural gas distribution affiliates and lower off-system sales. These declines were partially offset by increased revenues primarily from ancillary services, as well as from power generation and industrial customers.

In addition to operating income, this segment recorded equity income of $21 million for the year ended December 31, 2011, from its 50 percent interest in SESH compared to $19 million for the same period of 2010.

Field Services

The field services segment reported operating income of $53 million for the fourth quarter of 2011 compared to $57 million for the same period of 2010. Operating expenses for the fourth quarter of 2010 included a gain of $21 million associated with the sale of a small, non-strategic gas gathering system. Operating income for the fourth quarter of 2011 benefited from higher gathering volumes in the Haynesville and Fayetteville shales.

 

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For Immediate Release		Page 3 of 6

 

In addition to operating income, this business had equity income of $2 million for each of the fourth quarters of 2011 and 2010 from its 50 percent interest in a gathering and processing joint venture (Waskom).

Operating income for the year ended December 31, 2011, was $189 million compared to $151 million for the same period of 2010. Operating expenses for the year ended December 31, 2010, included a gain of $21 million associated with the sale of a small, non-strategic gas gathering system. Operating income for the year ended December 31, 2011, benefited from higher gathering volumes in the Haynesville and Fayetteville shales and revenues attributable to throughput volume commitments. These gains were partially offset by lower prices received from sales of retained gas, higher operation and maintenance, and depreciation and amortization expenses primarily related to facility expansions.

Equity income from Waskom was $9 million for the year ended December 31, 2011, compared to $10 million for the same period of 2010.

Competitive Natural Gas Sales and Services

The competitive natural gas sales and services segment reported operating income of $3 million for the fourth quarter of 2011 compared to no operating income for the same period of 2010. The fourth quarter of 2011 included a $5 million charge related to an early capacity release on pipeline transportation. In addition, the fourth quarter of 2011 included gains of $1 million resulting from mark-to-market accounting for derivatives associated with certain forward natural gas purchases and sales used to lock in economic margins compared to charges of $10 million for the same period of 2010. The fourth quarter of 2011 also included a $4 million write-down of natural gas inventory to the lower of average cost or market. Low basis spreads continued to negatively impact this segment’s results.

Operating income for the year ended December 31, 2011, was $6 million compared to $16 million for the same period of 2010. Operating income for the year ended December 31, 2011, included the $5 million early capacity release charge. In addition, operating income for the year ended December 31, 2011, included gains of $8 million resulting from mark-to-market accounting compared to gains of $4 million for the same period of 2010. The year ended December 31, 2011, included an $11 million write-down of natural gas inventory compared to a $6 million write-down in the same period of 2010.

 

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		For more information contact Media: Leticia Lowe Phone 713.207.7702 Investors: Marianne Paulsen Phone 713.207.6500
For Immediate Release		Page 4 of 6

 

Securitization Bond Issuance

On October 13, 2011, the Texas PUC approved a final order resolving all issues raised in connection with the Texas Supreme Court’s remand of the Texas PUC’s 2004 true-up order. The final order authorized the company to recover an additional true-up balance of $1.695 billion. On January 19, 2012, a wholly-owned special purpose subsidiary of the company closed on the sale of bonds to securitize the approved amount. In the third quarter of 2011, the company recorded net income of $811 million related to the true-up remand. An additional $258 million in net income will be recognized over the life of the securitization bonds.

Dividend Declaration

On January 19, 2012, CenterPoint Energy’s board of directors declared a regular quarterly cash dividend of $0.2025 per share of common stock payable on March 9, 2012, to shareholders of record as of the close of business on February 16, 2012. This marks the seventh consecutive year the company has increased its quarterly dividend.

Outlook for 2012

CenterPoint Energy expects earnings on a guidance basis for 2012 to be in the range of $1.08 to $1.20 per diluted share. Earnings guidance is being provided in the form of a range to reflect economic and operational variables associated with the company’s various business segments. Significant variables include the impact to earnings of commodity prices, volume throughput, weather, regulatory proceedings, effective tax rates and financing activities. In providing this guidance, the company does not include the impact of any changes in accounting standards, any impact from significant acquisitions or divestitures, any impact to earnings from the change in the value of Time Warner stocks and the related ZENS securities, or the timing effects of mark-to-market and inventory accounting in the company’s competitive natural gas sales and services business.

Filing of Form 10-K for CenterPoint Energy, Inc.

Today, CenterPoint Energy, Inc. filed with the Securities and Exchange Commission (SEC) its Annual Report on Form 10-K for the period ended December 31, 2011. A copy of that report is available on the company’s website under the Investors section. Other filings the company makes with the SEC and other documents relating to its corporate governance can also be found on that site.

Webcast of Earnings Conference Call

CenterPoint Energy’s management will host an earnings conference call on Wednesday, February 29, 2012, 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 on the company’s website under the Investors section. A replay of the call can be accessed approximately two hours after the completion of the call and will be archived on the website for at least one year.

 

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For Immediate Release		Page 5 of 6

 

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, interstate pipelines, and field services operations. The company serves more than five million metered customers primarily in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma and Texas. Assets total more than $21 billion. With over 8,800 employees, CenterPoint Energy and its predecessor companies have been in business for more than 135 years. For more information, visit the company’s website at CenterPointEnergy.com.

This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events and results may differ materially from those expressed or implied by these forward-looking statements. The statements in this news release regarding the company’s earnings outlook for 2012 and future financial performance and results of operations, and any other statements that are not historical facts are forward-looking statements. Each forward-looking statement contained in this news release speaks only as of the date of this release. Factors that could affect actual results include (1) state and federal legislative and regulatory actions or developments affecting various aspects of CenterPoint Energy’s businesses, including, among others, energy deregulation or re-regulation, pipeline integrity and safety, health care reform, financial reform and tax legislation; (2) state and federal legislative and regulatory actions or developments relating to the environment, including those related to global climate change; (3) timely and appropriate rate actions and increases, allowing recovery of costs and a reasonable return on investment; (4) the timing and outcome of any audits, disputes or other proceedings related to taxes; (5) problems with construction, implementation of necessary technology or other issues with respect to major capital projects that result in delays or in cost overruns that cannot be recouped in rates; (6) industrial, commercial and residential growth in CenterPoint Energy’s service territories and changes in market demand, including the effects of energy efficiency measures and demographic patterns; (7) the timing and extent of changes in commodity prices, particularly natural gas and natural gas liquids, and the effects of geographic and seasonal commodity price differentials, including the effects of these circumstances on re-contracting available capacity on CenterPoint Energy’s interstate pipelines; (8) the timing and extent of changes in the supply of natural gas, including supplies available for gathering by CenterPoint Energy’s field services business and transporting by its interstate pipelines; (9) competition in CenterPoint Energy’s mid-continent region footprint for access to natural gas supplies and to markets; (10) weather variations and other natural phenomena; (11) any direct or indirect effects on CenterPoint Energy’s facilities, operations and financial condition resulting from terrorism, cyber attacks, data security breaches or other attempts to disrupt its businesses or the businesses of third parties, or other catastrophic events; (12) the impact of unplanned facility outages; (13) timely and appropriate regulatory actions allowing securitization or other recovery of costs associated with any future hurricanes or natural disasters; (14) changes in interest rates or rates of inflation; (15) commercial bank and financial market conditions, CenterPoint Energy’s access to capital, the cost of such capital, and the results of our financing and refinancing efforts, including availability of funds in the debt capital markets; (16) actions by rating agencies; (17) effectiveness of CenterPoint Energy’s risk management activities; (18) inability of various counterparties to meet their obligations; (19) non-payment for services due to financial distress of CenterPoint Energy’s customers; (20) the ability of GenOn Energy, Inc. (formerly known as RRI Energy, Inc.) and its subsidiaries to satisfy their obligations to CenterPoint Energy and its subsidiaries; (21) the ability of retail electric providers, and particularly the two largest customers of the TDU, to satisfy their obligations to CenterPoint Energy and its subsidiaries; (22) the outcome of litigation brought by or against CenterPoint Energy; (23) CenterPoint Energy’s ability to control costs; (24) the investment performance of pension and postretirement benefit plans; (25) potential business strategies, including restructurings, acquisitions or dispositions of assets or businesses; (26) acquisition and merger activities involving CenterPoint Energy or its competitors; and (27) other factors discussed in CenterPoint Energy’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011, and other reports CenterPoint Energy or its subsidiaries may file from time to time with the Securities and Exchange Commission.

 

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CenterPoint Energy, Inc. and Subsidiaries

Reconciliation of reported Net Income and diluted EPS to the basis used in providing 2011 annual earnings guidance

 

		Quarter Ended December 31, 2011								Twelve Months Ended December 31, 2011
		Net Income				EPS				Net Income				EPS
		(in millions)								(in millions)
As reported		$	117			$	0.27			$	1,357			$	3.17
True-up related items:
Debt component return, net of taxes			—				—				(224	)			(0.52	)
Extraordinary item, net of taxes			—				—				(587	)			(1.37	)
Excluding true-up related items		$	117			$	0.27			$	546			$	1.27	(3)
Timing effects impacting CES(1):
Mark-to-market (gains) losses - natural gas derivative contracts			(1	)			(0.00	)			(6	)			(0.01	)
Natural gas inventory write-downs			3				0.01				7				0.02
ZENS-related mark-to-market (gains) losses:
Marketable securities(2)			(32	)			(0.07	)			(12	)			(0.03	)
Indexed debt securities			20				0.05				(23	)			(0.05	)
Per the basis used in providing 2011 annual earnings guidance		$	107			$	0.26			$	512			$	1.20

 

(1)	Competitive natural gas sales and services

(2)	Time Warner Inc., Time Warner Cable Inc. and AOL Inc.

(3)	Numbers do not add due to rounding

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CenterPoint Energy, Inc. and Subsidiaries

Statements of Consolidated Income

(Millions of Dollars)

(Unaudited)

 

		Three Months Ended December 31,								Year Ended December 31,
		2010				2011				2010				2011
Revenues:
Electric Transmission & Distribution		$	506			$	535			$	2,205			$	2,337
Natural Gas Distribution			813				793				3,213				2,841
Competitive Natural Gas Sales and Services			592				635				2,651				2,511
Interstate Pipelines			145				129				601				553
Field Services			96				107				338				412
Other Operations			2				2				11				11
Eliminations			(56	)			(56	)			(234	)			(215	)
Total			2,098				2,145				8,785				8,450
Expenses:
Natural gas			1,053				1,066				4,574				4,055
Operation and maintenance			451				502				1,719				1,835
Depreciation and amortization			204				209				864				886
Taxes other than income taxes			88				94				379				376
Total			1,796				1,871				7,536				7,152
Operating Income			302				274				1,249				1,298
Other Income (Expense):
Gain on marketable securities			32				49				67				19
Gain (loss) on indexed debt securities			(31	)			(30	)			(31	)			35
Interest and other finance charges			(117	)			(115	)			(481	)			(456	)
Interest on transition and system restoration bonds			(34	)			(31	)			(140	)			(127	)
Equity in earnings of unconsolidated affiliates			7				8				29				30
Return on true-up balance			—				—				—				352
Other—net			5				4				12				23
Total			(138	)			(115	)			(544	)			(124	)
Income Before Income Taxes and Extraordinary Item			164				159				705				1,174
Income Tax Expense			40				42				263				404
Income Before Extraordinary Item			124				117				442				770
Extraordinary Item, net of tax			—				—				—				587
Net Income		$	124			$	117			$	442			$	1,357

Reference is made to the Notes to the Consolidated Financial Statements

contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.

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CenterPoint Energy, Inc. and Subsidiaries

Selected Data From Statements of Consolidated Income

(Millions of Dollars, Except Share and Per Share Amounts)

(Unaudited)

 

		Three Months Ended December 31,								Year Ended December 31,
		2010				2011				2010				2011
Basic Earnings Per Common Share:
Income Before Extraordinary Item		$	0.29			$	0.27			$	1.08			$	1.81
Extraordinary item, net of tax			—				—				—				1.38
Net Income		$	0.29			$	0.27			$	1.08			$	3.19
Diluted Earnings Per Common Share:
Income Before Extraordinary Item		$	0.29			$	0.27			$	1.07			$	1.80
Extraordinary item, net of tax			—				—				—				1.37
Net Income		$	0.29			$	0.27			$	1.07			$	3.17
Dividends Declared per Common Share		$	0.1950			$	0.1975			$	0.7800			$	0.7900
Weighted Average Common Shares Outstanding (000):
- Basic			423,860				425,989				409,721				425,636
- Diluted			426,963				429,096				412,776				428,724
Operating Income by Segment
Electric Transmission & Distribution:
Electric Transmission and Distribution Operations		$	56			$	62			$	427			$	496
Transition and System Restoration Bond Companies			34				31				140				127
Total Electric Transmission & Distribution			90				93				567				623
Natural Gas Distribution			86				73				231				226
Competitive Natural Gas Sales and Services			—				3				16				6
Interstate Pipelines			63				52				270				248
Field Services			57				53				151				189
Other Operations			6				—				14				6
Total		$	302			$	274			$	1,249			$	1,298

Reference is made to the Notes to the Consolidated Financial Statements

contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.

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CenterPoint Energy, Inc. and Subsidiaries

Results of Operations by Segment

(Millions of Dollars)

(Unaudited)

 

		Electric Transmission & Distribution
		Three Months Ended December 31,								%  Diff Fav/(Unfav)				Year Ended December 31,								%  Diff Fav/(Unfav)
		2010				2011								2010				2011
Results of Operations:
Revenues:
Electric transmission and distribution utility		$	413			$	439				6	%		$	1,768			$	1,893				7	%
Transition and system restoration bond companies			93				96				3	%			437				444				2	%
Total			506				535				6	%			2,205				2,337				6	%
Expenses:
Operation and maintenance			232				253				(9	%)			841				908				(8	%)
Depreciation and amortization			74				72				3	%			293				279				5	%
Taxes other than income taxes			51				52				(2	%)			207				210				(1	%)
Transition and system restoration bond companies			59				65				(10	%)			297				317				(7	%)
Total			416				442				(6	%)			1,638				1,714				(5	%)
Operating Income		$	90			$	93				3	%		$	567			$	623				10	%
Operating Income:
Electric transmission and distribution operations		$	56			$	62				11	%		$	427			$	496				16	%
Transition and system restoration bond companies			34				31				(9	%)			140				127				(9	%)
Total Segment Operating Income		$	90			$	93				3	%		$	567			$	623				10	%
Electric Transmission & Distribution
Operating Data:
Actual MWH Delivered
Residential			5,054,882				5,173,066				2	%			26,554,309				28,510,924				7	%
Total			17,020,701				17,210,481				1	%			76,973,117				80,012,853				4	%
Weather (average for service area):
Percentage of 10-year average:
Cooling degree days			108	%			104	%			(4	%)			105	%			121	%			16	%
Heating degree days			94	%			96	%			2	%			133	%			102	%			(31	%)
Number of metered customers—end of period:
Residential			1,867,251				1,904,818				2	%			1,867,251				1,904,818				2	%
Total			2,110,608				2,155,710				2	%			2,110,608				2,155,710				2	%

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		Natural Gas Distribution
		Three Months Ended December 31,								% Diff Fav/ (Unfav)				Year Ended December 31,								% Diff Fav/ (Unfav)
		2010				2011								2010				2011
Results of Operations:
Revenues		$	813			$	793				(2	%)		$	3,213			$	2,841				(12	%)
Expenses:
Natural gas			486				472				3	%			2,049				1,675				18	%
Operation and maintenance			168				174				(4	%)			639				655				(3	%)
Depreciation and amortization			42				42				—				166				166				—
Taxes other than income taxes			31				32				(3	%)			128				119				7	%
Total			727				720				1	%			2,982				2,615				12	%
Operating Income		$	86			$	73				(15	%)		$	231			$	226				(2	%)
Natural Gas Distribution Operating Data:
Throughput data in BCF
Residential			52				50				(4	%)			177				172				(3	%)
Commercial and Industrial			67				64				(4	%)			249				251				1	%
Total Throughput			119				114				(4	%)			426				423				(1	%)
Weather (average for service area)
Percentage of 10-year average:
Heating degree days			100	%			88	%			(12	%)			107	%			100	%			(7	%)
Number of customers—end of period:
Residential			3,016,333				3,036,267				1	%			3,016,333				3,036,267				1	%
Commercial and Industrial			246,891				246,220				—				246,891				246,220				—
Total			3,263,224				3,282,487				1	%			3,263,224				3,282,487				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.

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CenterPoint Energy, Inc. and Subsidiaries

Results of Operations by Segment

(Millions of Dollars)

(Unaudited)

 

		Competitive Natural Gas Sales and Services
		Three Months Ended December 31,								% Diff Fav/(Unfav)				Year Ended December 31,								% Diff Fav/(Unfav)
		2010				2011								2010				2011
Results of Operations:
Revenues		$	592			$	635				7	%		$	2,651			$	2,511				(5	%)
Expenses:
Natural gas			582				620				(7	%)			2,591				2,458				5	%
Operation and maintenance			9				10				(11	%)			38				41				(8	%)
Depreciation and amortization			1				2				(100	%)			4				5				(25	%)
Taxes other than income taxes			—				—				—				2				1				50	%
Total			592				632				(7	%)			2,635				2,505				5	%
Operating Income		$	—			$	3				—			$	16			$	6				(63	%)
Competitive Natural Gas Sales and Services Operating Data:
Throughput data in BCF			144				151				5	%			548				558				2	%
Number of customers—end of period			12,193				14,267				17	%			12,193				14,267				17	%
		Interstate Pipelines
		Three Months Ended December 31,								% Diff Fav/(Unfav)				Year Ended December 31,								% Diff Fav/(Unfav)
		2010				2011								2010				2011
Results of Operations:
Revenues		$	145			$	129				(11	%)		$	601			$	553				(8	%)
Expenses:
Natural gas			21				13				38	%			93				67				28	%
Operation and maintenance			41				43				(5	%)			153				152				1	%
Depreciation and amortization			13				14				(8	%)			52				54				(4	%)
Taxes other than income taxes			7				7				—				33				32				3	%
Total			82				77				6	%			331				305				8	%
Operating Income		$	63			$	52				(17	%)		$	270			$	248				(8	%)
Equity in earnings of unconsolidated affiliates			4			$	6				50	%			19			$	21				11	%
Pipelines Operating Data:
Throughput data in BCF
Transportation			433				371				(14	%)			1,693				1,579				(7	%)

Reference is made to the Notes to the Consolidated Financial Statements

contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.

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CenterPoint Energy, Inc. and Subsidiaries

Results of Operations by Segment

(Millions of Dollars)

(Unaudited)

 

		Field Services
		Three Months Ended December 31,								% Diff Fav/(Unfav)				Year Ended December 31,								% Diff Fav/(Unfav)
		2010				2011								2010				2011
Results of Operations:
Revenues		$	96			$	107				11	%		$	338			$	412				22	%
Expenses:
Natural gas			19				16				16	%			72				68				6	%
Operation and maintenance			10				29				(190	%)			85				112				(32	%)
Depreciation and amortization			8				9				(13	%)			25				37				(48	%)
Taxes other than income taxes			2				—				—				5				6				(20	%)
Total			39				54				(38	%)			187				223				(19	%)
Operating Income		$	57			$	53				(7	%)		$	151			$	189				25	%
Equity in earnings of unconsolidated affiliates		$	2			$	2				—			$	10			$	9				(10	%)
Field Services Operating Data:
Throughput data in BCF
Gathering			186				237				27	%			650				823				27	%
		Other Operations
		Three Months Ended December 31,								% Diff Fav/(Unfav)				Year Ended December 31,								% Diff Fav/(Unfav)
		2010				2011								2010				2011
Results of Operations:
Revenues		$	2			$	2				—			$	11			$	11				—
Expenses (Income)			(4	)			2				(150	%)			(3	)			5				(267	%)
Operating Income		$	6			$	—				—			$	14			$	6				(57	%)

Capital Expenditures by Segment

(Millions of Dollars)

(Unaudited)

 

		Three Months Ended December 31,								Year Ended December 31,
		2010				2011				2010				2011
Capital Expenditures by Segment
Electric Transmission & Distribution		$	146			$	173			$	463			$	538
Natural Gas Distribution			74				80				202				295
Competitive Natural Gas Sales and Services			—				1				2				5
Interstate Pipelines			31				34				102				98
Field Services			196				38				668				201
Other Operations			10				26				25				54
Total		$	457			$	352			$	1,462			$	1,191

(Millions of Dollars)

(Unaudited)

 

		Three Months Ended December 31,								Year Ended December 31,
		2010				2011				2010				2011
Interest Expense Detail
Amortization of Deferred Financing Cost		$	6			$	4			$	24			$	27
Capitalization of Interest Cost			(4	)			1				(9	)			(4	)
Transition and System Restoration Bond Interest Expense			34				31				140				127
Other Interest Expense			115				110				466				433
Total Interest Expense		$	151			$	146			$	621			$	583

Reference is made to the Notes to the Consolidated Financial Statements

contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.

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CenterPoint Energy, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(Millions of Dollars)

(Unaudited)

 

		December 31,				December 31,
		2010				2011
ASSETS
Current Assets:
Cash and cash equivalents		$	199			$	220
Other current assets			2,383				2,117
Total current assets			2,582				2,337
Property, Plant and Equipment, net			11,732				12,402
Other Assets:
Goodwill			1,696				1,696
Regulatory assets			3,446				4,619
Other non-current assets			655				649
Total other assets			5,797				6,964
Total Assets		$	20,111			$	21,703
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Short-term borrowings		$	53			$	62
Current portion of transition and system restoration bonds long-term debt			283				307
Current portion of indexed debt			126				131
Current portion of other long-term debt			19				46
Other current liabilities			2,139				2,047
Total current liabilities			2,620				2,593
Other Liabilities:
Accumulated deferred income taxes, net			2,934				3,832
Regulatory liabilities			989				1,039
Other non-current liabilities			1,369				1,376
Total other liabilities			5,292				6,247
Long-term Debt:
Transition and system restoration bonds			2,522				2,215
Other			6,479				6,426
Total long-term debt			9,001				8,641
Shareholders’ Equity			3,198				4,222
Total Liabilities and Shareholders’ Equity		$	20,111			$	21,703

Reference is made to the Notes to the Consolidated Financial Statements

contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.

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CenterPoint Energy, Inc. and Subsidiaries

Condensed Statements of Consolidated Cash Flows

(Millions of Dollars)

(Unaudited)

 

		Year Ended December 31,
		2010				2011
Cash Flows from Operating Activities:
Net income		$	442			$	1,357
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			891				916
Deferred income taxes			199				443
Extraordinary item, net of tax			—				(587	)
Return on true-up balance			—				(352	)
Write-down of natural gas inventory			6				11
Changes in net regulatory assets			14				31
Changes in other assets and liabilities			(164	)			45
Other, net			(2	)			24
Net Cash Provided by Operating Activities			1,386				1,888
Net Cash Used in Investing Activities			(1,420	)			(1,206	)
Net Cash Used in Financing Activities			(507	)			(661	)
Net Increase (Decrease) in Cash and Cash Equivalents			(541	)			21
Cash and Cash Equivalents at Beginning of Period			740				199
Cash and Cash Equivalents at End of Period		$	199			$	220

Reference is made to the Notes to the Consolidated Financial Statements

contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.

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