SOUTHERN COMPANY 
By ATLANTA, Jan. 30, 2013 /PRNewswire/ -- Southern Company today reported fourth quarter 2012 earnings of $383 million, or 44 cents a share, compared with earnings of $261 million, or 30 cents a share, in the fourth quarter of 2011. Southern Company also reported full-year 2012 earnings of $2.35 billion, or $2.70 a share, compared with earnings for 2011 of $2.20 billion, or $2.57 a share.
Earnings for the full year included 2 cents a share of insurance recovery related to the March 2009 settlement agreement with MC Asset Recovery, LLC (MCAR) to resolve a lawsuit arising out of the 2003 bankruptcy of Mirant Corp., a Southern Company subsidiary until its 2001 spinoff. Excluding the impact of the MCAR insurance recovery, Southern Company earned $2.68 a share in 2012, compared with $2.57 a share for 2011.
Earnings for the fourth quarter of 2012 and the full year were positively influenced by reduced non-fuel operations and maintenance expenses and by other retail revenue effects across Southern Company's traditional operating companies. Full-year 2012 earnings were negatively affected by significantly milder weather throughout the year as compared with 2011.
"Our employees continue to find ways to make our business more efficient, while delivering customer service that is among the best in our industry," said Thomas A. Fanning, Southern Company chairman, president and chief executive officer. "Their efforts demonstrate the effectiveness of our business model - which succeeds by placing customers at the center of everything we do - and reaffirm our commitment to providing clean, safe, reliable, affordable electricity."
Fanning said that economic prospects in the Southeast remain bright, but that expansion and hiring decisions continue to be delayed pending longer-term congressional action on fiscal issues.
Operating revenues for the full year were $16.54 billion, compared with $17.66 billion in 2011, a 6.3 percent decrease that was due primarily to lower fuel costs being passed on to customers. Fourth quarter revenues were $3.703 billion, compared with $3.696 billion for the same period in 2011, an increase of 0.2 percent.
Kilowatt-hour sales to retail customers in Southern Company's four-state service area decreased 2.3 percent in 2012, compared with 2011. Residential and commercial energy sales - both of which were affected by milder weather in 2012 - decreased 5.4 percent and 1.6 percent, respectively, while industrial energy sales increased 0.2 percent.
Total energy sales to Southern Company's customers in the Southeast, including wholesale sales, decreased 3.4 percent in 2012 compared with 2011.
Southern Company's financial analyst call will begin at 1 p.m. Eastern time today, during which Fanning and Chief Financial Officer Art P. Beattie will discuss earnings and provide a general business update. Investors, media and the public may listen to a live webcast of the call and view associated slides at http://investor.southerncompany.com/events.cfm. A replay of the webcast only will be available at the site for 12 months.
Southern Company has also posted on its website detailed financial information on its fourth quarter and full-year performance. These materials are available at www.southerncompany.com.
With 4.4 million customers and more than 43,000 megawatts of generating capacity, Atlanta-based Southern Company (NYSE: SO) is the premier energy company serving the Southeast through its subsidiaries. A leading U.S. producer of clean, safe, reliable and affordable electricity, Southern Company owns electric utilities in four states and a growing competitive generation company, as well as fiber optics and wireless communications. Southern Company brands are known for energy innovation, excellent customer service, high reliability and retail electric prices that are below the national average. Southern Company and its subsidiaries are leading the nation's nuclear renaissance through the construction of the first new nuclear units to be built in a generation of Americans and are demonstrating their commitment to energy innovation through the development of a state-of-the-art coal gasification plant. Southern Company has been recognized by the U.S. Department of Defense and G.I. Jobs magazine as a top military employer and listed by DiversityInc as a top company for Blacks. The company received the 2012 Edison Award from the Edison Electric Institute for its leadership in new nuclear development, was named Electric Light & Power magazine's Utility of the Year for 2012 and is continually ranked among the top utilities in Fortune's annual World's Most Admired Electric and Gas Utility rankings. Visit our website at www.southerncompany.com.
Cautionary Note Regarding Forward-Looking Statements:
Certain information contained in this release is forward-looking information based on current expectations and plans that involve risks and uncertainties. Forward-looking information includes, among other things, statements concerning the economy and customer growth. Southern Company cautions that there are certain factors that can cause actual results to differ materially from the forward-looking information that has been provided. The reader is cautioned not to put undue reliance on this forward-looking information, which is not a guarantee of future performance and is subject to a number of uncertainties and other factors, many of which are outside the control of Southern Company; accordingly, there can be no assurance that such suggested results will be realized. The following factors, in addition to those discussed in Southern Company's Annual Report on Form 10-K for the year ended December 31, 2011, and subsequent securities filings, could cause actual results to differ materially from management expectations as suggested by such forward-looking information: the impact of recent and future federal and state regulatory changes, including legislative and regulatory initiatives regarding deregulation and restructuring of the electric utility industry, implementation of the Energy Policy Act of 2005, environmental laws including regulation of water, coal combustion byproducts, and emissions of sulfur, nitrogen, carbon, soot, particulate matter, hazardous air pollutants, including mercury, and other substances, financial reform legislation, and also changes in tax and other laws and regulations to which Southern Company and its subsidiaries are subject, as well as changes in application of existing laws and regulations; current and future litigation, regulatory investigations, proceedings, or inquiries, including the pending Environmental Protection Agency civil actions against certain Southern Company subsidiaries, Federal Energy Regulatory Commission matters, and Internal Revenue Service and state tax audits; the effects, extent, and timing of the entry of additional competition in the markets in which Southern Company's subsidiaries operate; variations in demand for electricity, including those relating to weather, the general economy and recovery from the recent recession, population and business growth (and declines), the effects of energy conservation measures, and any potential economic impacts resulting from federal fiscal and budgetary decisions; available sources and costs of fuels; effects of inflation; ability to control costs and avoid cost overruns during the development and construction of facilities, which includes projects involving facility designs that have not been finalized or previously constructed; investment performance of Southern Company's employee benefit plans and nuclear decommissioning trust funds; advances in technology; state and federal rate regulations and the impact of pending and future rate cases and negotiations, including rate actions relating to fuel and other cost recovery mechanisms; regulatory approvals and actions related to the Plant Vogtle expansion, including Georgia Public Service Commission approvals, Nuclear Regulatory Commission actions, and potential U.S. Department of Energy loan guarantees; regulatory approvals and actions related to the Kemper County integrated coal gasification combined cycle facility, including Mississippi Public Service Commission approvals, the South Mississippi Electric Power Association purchase decision, satisfaction of requirements to utilize investment tax credits and grants, and the outcome of any further proceedings regarding the Mississippi Public Service Commission's issuance of the certificate of public convenience and necessity; the performance of projects undertaken by the non-utility businesses and the success of efforts to invest in and develop new opportunities; internal restructuring or other restructuring options that may be pursued; potential business strategies, including acquisitions or dispositions of assets or businesses, which cannot be assured to be completed or beneficial to Southern Company or its subsidiaries; the ability of counterparties of Southern Company and its subsidiaries to make payments as and when due and to perform as required; the ability to obtain new short- and long-term contracts with wholesale customers; the direct or indirect effect on the Southern Company system's business resulting from terrorist incidents and the threat of terrorist incidents, including cyber intrusion; interest rate fluctuations and financial market conditions and the results of financing efforts, including Southern Company's and its subsidiaries' credit ratings; the impacts of any potential U.S. credit rating downgrade or other sovereign financial issues, including impacts on interest rates, access to capital markets, impacts on currency exchange rates, counterparty performance, and the economy in general, as well as potential impacts on the availability or benefits of proposed U.S. Department of Energy loan guarantees; the ability of Southern Company and its subsidiaries to obtain additional generating capacity at competitive prices; catastrophic events such as fires, earthquakes, explosions, floods, hurricanes, droughts, pandemic health events such as influenzas, or other similar occurrences; the direct or indirect effects on the Southern Company system's business resulting from incidents affecting the U.S. electric grid or operation of generating resources; and the effect of accounting pronouncements issued periodically by standard setting bodies. Southern Company expressly disclaims any obligation to update any forward-looking information.
Southern Company
Financial Highlights
(In Millions of Dollars Except Earnings Per Share)
Three Months Ended Year-to-Date
December December
--------
2012 2011 2012 2011
---- ---- ---- ----
Consolidated Earnings-As Reported
(See Notes)
Traditional Operating Companies $349 $248 $2,146 $2,052
Southern Power 31 24 175 162
--- --- --- ---
Total 380 272 2,321 2,214
Parent Company and Other 3 (11) 29 (11)
--- --- --- ---
Net Income-As Reported $383 $261 $2,350 $2,203
==== ==== ====== ======
Basic Earnings Per Share $0.44 $0.30 $2.70 $2.57
Average Shares Outstanding (in millions) 869 865 871 857
End of Period Shares Outstanding (in millions) 868 867
Three Months Ended Year-to-Date
December December
-------- --------
2012 2011 2012 2011
---- ---- ---- ----
Consolidated Earnings-Excluding Items
(See Notes)
Net Income-As Reported $383 $261 $2,350 $2,203
MC Asset Recovery Insurance Settlement, net - - (21) -
--- --- --- ---
Net Income-Excluding Items $383 $261 $2,329 $2,203
==== ==== ====== ======
Basic Earnings Per Share-Excluding Items $0.44 $0.30 $2.68 $2.57
Notes
-----
- For the three months and twelve months ended December 31, 2012 and 2011, dilution does not change basic earnings per share by more than 3 cents and is not material.
-In March 2009, Southern Company recorded a charge related to a settlement agreement with MC Asset Recovery, LLC (MCAR) to settle a lawsuit. Southern Company filed an insurance claim for a portion of the MCAR settlement amount. In June 2012, Southern Company
received an insurance recovery related to this claim. Earnings for the twelve months ended December 31, 2012 include 2 cents a share for the MCAR insurance recovery.
- Certain prior year data has been reclassified to conform with current year presentation.
- All figures in this earnings release are preliminary and remain subject to the completion of normal year-end accounting procedures and adjustments, which could result in changes to these preliminary results. In addition, certain classifications and rounding
may be different from final results published in the Form 10-K.
Southern Company
Significant Factors Impacting EPS
Three Months Ended Year-to-Date
December December
-------- --------
2012 2011 Change 2012 2011 Change
---- ---- ------ ---- ---- ------
Consolidated Earnings Per Share-
As Reported (See Notes) $0.44 $0.30 $0.14 $2.70 $2.57 $0.13
Significant Factors:
--------------------
Traditional Operating Companies 0.12 0.11
Southern Power 0.01 0.02
Parent Company and Other 0.01 0.05
Additional Shares - (0.05)
--- -----
Total-As Reported $0.14 $0.13
===== =====
Three Months Ended Year-to-Date
December December
-------- --------
2012 2011 Change 2012 2011 Change
---- ---- ------ ---- ---- ------
Consolidated Earnings Per Share-
Excluding Items (See Notes) $0.44 $0.30 $0.14 $2.68 $2.57 $0.11
Total-As Reported 0.14 0.13
MC Asset Recovery Insurance Settlement - (0.02)
--- -----
Total-Excluding Items $0.14 $0.11
===== =====
Notes
-----
-For the three months and twelve
months ended December 31, 2012 and
2011, dilution does not change
basic earnings per share by more
than 3 cents and is not material.
-In March 2009, Southern Company
recorded a charge related to a
settlement agreement with MC Asset
Recovery, LLC (MCAR) to settle a
lawsuit. Southern Company filed
an insurance claim for a portion
of the MCAR settlement amount. In
June 2012, Southern Company
received an insurance recovery
related to this claim. Earnings
for the twelve months ended
December 31, 2012 include 2 cents
a share for the MCAR insurance
recovery.
-Certain prior year data has been
reclassified to conform with
current year presentation.
- All figures in this earnings
release are preliminary and remain
subject to the completion of
normal year-end accounting
procedures and adjustments, which
could result in changes to these
preliminary results. In addition,
certain classifications and
rounding may be different from
final results published in the
Form 10-K.
Southern Company
EPS Earnings Analysis
Description Three Months Ended Year-to-Date
December 2012 December 2012
--- ------------- -------------
Retail Sales 3¢ 2¢
Retail Revenue Impacts 2 22
Weather 1 (20)
Other Operating Revenues 1 -
Non-Fuel O&M 9 11
Purchased Power Capacity
Expense 1 5
Depreciation and
Amortization (1) (4)
Taxes Other Than Income
Taxes (1) (1)
Other Income and
Deductions - (1)
Interest Expense - (2)
Income Taxes (3) (1)
Total Traditional
Operating Companies 12¢ 11¢
-------------------- --- ---
Southern Power 1 2
Parent and Other 1 3
Increase in Shares - (5)
Total Change in EPS (x-
items) 14¢ 11¢
----------------------- --- ---
MC Asset Recovery
Insurance Settlement - 2
Total Change in EPS (As
Reported) 14¢ 13¢
----------------------- --- ---
Notes
-----
-In March 2009, Southern Company recorded a charge related to a settlement agreement with MC
Asset Recovery, LLC (MCAR) to settle a lawsuit. Southern Company filed an insurance claim for
a portion of the MCAR settlement amount. In June 2012, Southern Company received an insurance
recovery related to this claim. Earnings for the twelve months ended December 31, 2012
include 2 cents a share for the MCAR insurance recovery.
- All figures in this earnings release are preliminary and remain subject to the completion of
normal year-end accounting procedures and adjustments, which could result in changes to
these preliminary results. In addition, certain classifications and rounding may be different
from final results published in the Form 10-K.
Southern Company
Consolidated Earnings
(In Millions of Dollars)
Three Months Ended Year-to-Date
December December
-------- --------
2012 2011 Change 2012 2011 Change
---- ---- ------ ---- ---- ------
Income Account-
Retail Revenues-
Fuel $1,034 $1,144 $(110) $4,743 $5,686 $(943)
Non-Fuel 2,085 1,996 89 9,444 9,385 59
Wholesale Revenues 414 392 22 1,675 1,905 (230)
Other Electric Revenues 157 147 10 616 611 5
Non-regulated Operating
Revenues 13 17 (4) 59 70 (11)
--- --- --- --- --- ---
Total Revenues 3,703 3,696 7 16,537 17,657 (1,120)
----- ----- --- ------ ------ ------
Fuel and Purchased Power 1,239 1,353 (114) 5,601 6,870 (1,269)
Non-fuel O & M 974 1,101 (127) 3,791 3,938 (147)
MC Asset Recovery Insurance
Settlement - - - (19) - (19)
Depreciation and Amortization 452 438 14 1,787 1,717 70
Taxes Other Than Income Taxes 224 215 9 914 901 13
--- --- --- --- --- ---
Total Operating Expenses 2,889 3,107 (218) 12,074 13,426 (1,352)
----- ----- ---- ------ ------ ------
Operating Income 814 589 225 4,463 4,231 232
Allowance for Equity Funds
Used During Construction 41 40 1 143 153 (10)
Interest Income 6 7 (1) 40 21 19
Interest Expense, Net of
Amounts Capitalized 210 219 (9) 859 857 2
Other Income (Expense), net (16) (44) 28 (38) (61) 23
Income Taxes 236 96 140 1,334 1,219 115
--- --- --- ----- ----- ---
Net Income 399 277 122 2,415 2,268 147
Dividends on Preferred and
Preference Stock of
Subsidiaries 16 16 - 65 65 -
--- --- --- --- --- ---
NET INCOME AFTER DIVIDENDS ON
PREFERRED AND PREFERENCE
STOCK (See Notes) $383 $261 $122 $2,350 $2,203 $147
==== ==== ==== ====== ====== ====
Notes
-----
- Certain prior year data has been reclassified to conform with current year presentation.
- All figures in this earnings release are preliminary and remain subject to the completion of normal year-end accounting procedures and adjustments, which could result in changes to these preliminary results. In addition, certain classifications and rounding may be different from final
results published in the Form 10-K.
Southern Company
Kilowatt-Hour Sales
(In Millions of KWHs)
Three Months Ended December Year-to-Date December
--------------------------- ---------------------
As Reported 2012 2011 Change Weather 2012 2011 Change Weather
(See Notes) Adjusted Adjusted
Change Change
-------- --------
Kilowatt-Hour Sales-
Total Sales 42,543 41,558 2.4% 183,617 190,047 (3.4)%
Total Retail Sales- 36,109 35,183 2.6% 1.7% 156,054 159,702 (2.3)% 0.4%
Residential 11,140 10,447 6.6% 5.2% 50,454 53,341 (5.4)% 1.1%
Commercial 12,273 12,183 0.7% (0.7)% 53,007 53,855 (1.6)% (0.2)%
Industrial 12,468 12,323 1.2% 1.2% 51,674 51,570 0.2% 0.2%
Other 228 230 (0.7)% (0.8)% 919 936 (1.8)% (1.4)%
Total Wholesale Sales 6,434 6,375 0.9% N/A 27,563 30,345 (9.2)% N/A
Notes
-----
- Certain prior year data has been reclassified to conform with current year presentation.
- All figures in this earnings release are preliminary and remain subject to the completion of normal year-end accounting procedures and adjustments, which could result in changes to these preliminary results. In addition, certain classifications and rounding may be different from final results
published in the Form 10-K.
Southern Company
Financial Overview
(In Millions of Dollars)
Three Months Ended Year-to-Date
December December
-------- --------
2012 2011 % Change 2012 2011 % Change
---- ---- -------- ---- ---- --------
Consolidated -
Operating Revenues $3,703 $3,696 0.2% $16,537 $17,657 (6.3)%
Earnings Before Income Taxes 635 373 70.2% 3,749 3,487 7.5%
Net Income Available to Common 383 261 46.7% 2,350 2,203 6.7%
Alabama Power -
Operating Revenues $1,290 $1,271 1.5% $5,520 $5,702 (3.2)%
Earnings Before Income Taxes 205 182 12.6% 1,220 1,225 (0.4)%
Net Income Available to Common 113 102 10.8% 704 708 (0.6)%
Georgia Power -
Operating Revenues $1,735 $1,758 (1.3)% $7,998 $8,800 (9.1)%
Earnings Before Income Taxes 315 156 101.9% 1,873 1,787 4.8%
Net Income Available to Common 181 110 64.5% 1,168 1,145 2.0%
Gulf Power -
Operating Revenues $331 $328 1.1% $1,440 $1,520 (5.3)%
Earnings Before Income Taxes 39 29 34.4% 211 173 22.5%
Net Income Available to Common 23 19 20.3% 126 105 19.9%
Mississippi Power -
Operating Revenues $236 $238 (0.8)% $1,036 $1,113 (6.9)%
Earnings Before Income Taxes 42 20 102.7% 200 138 45.0%
Net Income Available to Common 33 16 104.1% 148 94 57.3%
Southern Power -
Operating Revenues $292 $286 1.8% $1,186 $1,236 (4.0)%
Earnings Before Income Taxes 48 22 116.3% 268 238 12.5%
Net Income Available to Common 31 24 30.1% 175 162 8.0%
Notes
-----
- Certain prior year data has been reclassified to conform with current year presentation.
- All figures in this earnings release are preliminary and remain subject to the completion of normal year-end accounting procedures and adjustments, which could result in changes to these preliminary results. In addition, certain classifications and rounding may be different from
final results published in the Form 10-K.
SOURCE Southern Company
