These statements are current expectations and as such are subject to a variety of risks and uncertainties that could cause actual results to differ materially from current expectations. These risk and uncertainties include the factors discussed in our Form 10Qs for periods ended March, June and September 2011 and the Form 10K for the year ended December 31, 2010.You’ll also find reconciliations of certain non-GAAP financial information on our website at www.NVEnergy.com. With us this morning are Michael Yackira, President and Chief Executive Officer and Dilek Samil, Senior Vice President, Chief Financial Officer and Treasurer. I’ll now turn the call over to Dilek. Dilek L. Samil As we announced this morning, for the fourth quarter of 2011 we had a net loss of $25 million or $0.11 per diluted share as compared with net income of $14 million or $0.06 per share for the same period a year ago. This brings total earnings for the year 2011 to $0.69 per diluted share compared with $0.96 in 2010. Major drivers of our fourth quarter results are shown on Slide Two. Gross margin was virtually unchanged for the fourth quarter. Weather and customer growth were slightly positive, megawatt hour sales increased about 1% driven by customer growth of just under 1% as well as colder weather compared to last year. Offsetting this increase was a decrease in margin due to the sale of our California operation which was completed in January 2011. Turning to items below the gross margin line, you’ll recall that we completed the Harry Allen combined cycle plant in the second quarter. Placing this plant in service reduced AFUDC, increased depreciation and increased operating and maintenance expense. The total impact of Harry Allen was $0.05 negative for the fourth quarter compared to the same period last year.
Timing of outages at several of our power plants reduced EPS by $0.03 in the quarter. These were primarily planned maintenance outages. Finally regulatory adjustments and reserves reduced earnings per share by approximately $0.05. These adjustments were primarily related to the decision on the Southern Utility Rate case.As a result of the PUCN’s order, earnings were reduced by approximately $16 million pre-tax or about $0.04 of EPS impact primarily related to the Clark peaking units, the Ely Energy Center and AFUDC for Harry Allen. The remaining $0.01 consisted of reserves recorded for potential future liability. In summary, our fourth quarter results were driven by Harry Allen, timing of plant outages and regulatory adjustments. Turning now to earnings for the full year 2011 we knew going into ’11 that we would be challenged by regulatory lag and indeed that was the case. As I just mentioned, we reported full year earnings of $0.69 down $0.27 as compared to the prior year. Margin was down about $0.04 year-over-year, driven primarily by the sale of the California assets. Excluding California, megawatt hour sales were essentially flat compared to the prior year. Customer growth of just under 1% was offset by slightly milder weather in comparison to the prior year and the effect of conservation programs. Below the gross margin line Harry Allen regulatory lag reduced EPS by about $0.12 year-over-year. O&M expense excluding the impact of Harry Allen was an improvement of $0.02 compared to the prior year. Our goal was to hold O&M flat year-over-year and I’m pleased to report that we did achieve that goal. The full year impact of regulatory adjustments and reserves was $0.07 negative. This consists of the approximately $0.05 primarily rate case adjustments that we recorded in the fourth quarter that I just mentioned plus the $0.02 for the reversal of loss revenue that was recorded in 2010. As you will recall, that Commission Order that we received in ’11 resulted in this adjustment. Read the rest of this transcript for free on seekingalpha.com