News Column

Emera Reports Solid Earnings for Q2 2014

August 11, 2014

HALIFAX, Nova Scotia--(BUSINESS WIRE)-- Emera (TSX:EMA) today reported results for the second quarter of 2014.

Financial Highlights:

  • Operating revenues of $566.6 million in Q2 2014 increased 11.9% compared to Q2 2013.
  • Adjusted net income(1)(before after-tax mark-to-market impacts) of $44.2 million in Q2 2014 is an increase of 3.8% compared to $42.6 million in Q2 2013. Reported net income, including mark-to-market losses, was $24.5 million in Q2 2014 (Q2 2013, $44.9 million).
  • Adjusted earnings per share(1) was $0.31 in Q2 2014 (Q2 2013, $0.32). Year-to-date adjusted earnings per share(1) of $1.34 is an 11.7% increase over $1.20 for the six months ending June 30th 2013.
  • Cash flowfrom operations increased 75.9% to $410.2 million for the six months ending June 30th 2014 (YTD 2013, $233.2 million) primarily due to higher cash earnings from trading and marketing in Emera Energy.

    “Emera had a solid quarter with improvement in revenue, cash flow and adjusted earnings” said Chris Huskilson, President and CEO of Emera Inc. “Our strong year to date financial results reflect the continuing success of our strategy and positive impacts from our complimentary portfolio of assets.”

    Consolidated Financial Highlights (in millions of $CAD, except per share amounts)

         

    Three months ended

    June 30

       

    Six months ended

    June 30

          2014   2013     2014   2013
    Operating revenues$566.6$506.5$1,616.9$1,144.6
    Adjusted EBITDA(1)* $185.2$164.3$516.2$439.6
             
    Net income attributable to common shareholders$24.5$44.9$227.3$167.7
    After-tax mark-to-market gain (loss) ($19.7) $2.3$36.5$9.7
    Adjusted net income attributable to common shareholders(1)* $44.2$42.6$190.8$158.0
             
    Earnings per common share - basic$0.17$0.34$1.59$1.27
    Adjusted earnings per common share – basic(1)* $0.31$0.32

    $1.34

    $1.20

    Dividends per common share declared$0.3625$0.3500$0.7250$0.7000
    Total Assets (as at June 30th)$9,069.9$7,994.0

    Common Stock issued and outstanding

    (millions of shares as at June 30th)

    142.58

    131.88

     

    *Adjusted EBITDA(1), Adjusted net income(1) and Adjusted earnings per common share(1) excludes the effect

    of mark-to-market adjustments.





    In the quarter, operating revenues increased $60.1 million over the same quarter last year. The increase was primarily due to the 2013 acquisition of the New England Gas Generating facilities and Brooklyn Energy, partially offset by mark-to-market losses in Emera Energy.

    Adjusted net income(1) increased $1.6 million in Q2 2014 as compared with Q2 2013, primarily due to increased contributions from Emera Energy’s Trading and Marketing and Bear Swamp.

    After-tax mark-to-market adjustments impacted net income by $(19.7) million or $(0.14) per common share in Q2 2014, primarily due to changes in existing positions on long-term gas purchase contracts.

    Operating Highlights:

  • The New England Gas Plants acquired in Q4 2013, contributed $28.4 million to Adjusted EBITDA(1) and had 90.9% availability year-to-date. The plants are performing as expected.
  • The Maritime Link Project remains on time and budget. Two of the three major contracts for the Maritime Link have now been awarded. The subsea cable contract was awarded in Q1 2014 and the converter station contract was recently awarded, with the transmission construction contract the remaining major contract to be awarded (Q4 2014/Q1 2015).

    Segmented Results

    Emera now reports its results in six operating segments: Nova Scotia Power, Emera Maine, Emera Caribbean, Pipelines, Emera Energy, and Corporate and Other.

    Quarterly Segmented Results (in millions of $CAD, except per share amounts)

          Adjusted Net Income(1)
          Q2 2014   Q2 2013     YTD 2014   YTD 2013
    Nova Scotia Power Inc.$17.1$18.5$83.9$81.7
    Emera Maine$7.0$8.9$17.4$17.8
    Emera Caribbean$7.8$8.0$14.4$12.4
    Pipelines$8.3$6.8$15.5$14.0
    Emera Energy*$5.2$(1.4)$66.2$21.9
    Corporate and Other$(1.2)$1.8$(6.6) 10.2
    TOTAL$44.2$42.6$190.8$158.0
    Adjusted EPS (basic)(1)$0.31$0.32$1.34$1.20

    *Adjusted net income(1)excludes after-tax mark-to-market loss in Emera Energy of $19.7 million (Q2 2013,

    after-tax mark-to-market gain of $2.3 million).





    Nova Scotia Power Inc.’s net income was $17.1 million in Q2 2014 (Q2 2013, $18.5 million). The decrease in net income is primarily due to the timing of regulatory deferral impacts and increased income tax expense. NSPI’s rate base and earnings for the full year are expected to be similar to 2013.

    Emera Maine’s net income was $7.0 million in Q2 2014 (Q2 2013, $8.9 million). The lower net income was primarily due to decreased transmission pool revenue as a result of weather in the New England region.

    Emera Caribbean’s net income was $7.8 million in Q2 2014 compared to $8.0 million in Q2 2013.

    Pipelines’ contributed $8.3 million to consolidated net income in Q2 2014, an increase of $1.5 million over Q2 2013 primarily due to lower interest expense.

    Emera Energy’s net income, adjusted to exclude mark to market impacts, was $5.2 million in Q2 2014 as compared to a loss of $1.4 million in the same quarter last year. The $6.6 million increase in adjusted net income(1) was primarily due to higher contributions from Trading and Marketing and Bear Swamp, reflecting market conditions; and cost savings at Northeast Wind Partners II, LLC.

    Corporate and Other’s net income was $(1.2) million in Q2 2014 (Q2 2013, $1.8 million). The decrease in net income is primarily due to an increase in income tax expense.

    (1) Non-GAAP Measures

    Emera uses financial measures that do not have standardized meaning under USGAAP and may not be comparable to similar measures presented by other entities. Emera calculates the non-GAAP measures by adjusting certain GAAP and non-GAAP measures for specific items the Company believes are significant, but not reflective of underlying operations in the period. Refer to the Non-GAAP Financial Measures section of our Management's Discussion and Analysis ("MD&A") for further discussion of these items.

    Forward Looking Information

    This news release contains forward looking information. Actual future results may differ materially. Additional information related to Emera, including the company’s Annual Information Form, can be found on SEDAR at www.sedar.com.

    Teleconference Call

    The company will be hosting a teleconference Tuesday, August 12, 2014 at 10:00am Atlantic time (9:00amToronto/Montreal/New York; 8:00amWinnipeg; 7:00amCalgary; 6:00amVancouver) to discuss the Q2 2014 financial results.

    Analysts and other interested parties in North America wanting to participate in the call should dial 1 (888) 241-0394 at least 10 minutes prior to the start of the call. International participants wanting to participate should dial (647) 427-3413. No pass code is required. The teleconference will be recorded. If you are unable to join the teleconference live, you can dial for playback, toll-free at 1-855-859-2056. The Conference ID is 71204454 (available until midnight, August 29, 2014).

    The teleconference will also be web cast live at emera.com and available for playback for one year.

    About Emera

    Emera Inc. is geographically diverse energy and services company headquartered in Halifax, Nova Scotia with $9.07 billion in assets and 2013 revenues of $2.2 billion. The company invests in electricity generation, transmission and distribution, as well as gas transmission and utility energy services. Emera's strategy is focused on the transformation of the electricity industry to cleaner generation and the delivery of that clean energy to market. Emera has investments throughout northeastern North America, and in four Caribbean countries. Approximately 80% of the company's reported net income in 2013 came from regulated investments. Emera common and preferred shares are listed on the Toronto Stock Exchange and trade respectively under the symbol EMA, EMA.PR.A, EMA.PR.C, EMA.PR.E, and EMA.PR.F. Additional Information can be accessed at www.emera.com or at www.sedar.com.





    Emera Inc.

    Scott LaFleur, 902-428-6375

    Acting Manager, Investor Relations



    Source: Emera Inc.


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