TECO Energy Reports First-Quarter Results

TECO Energy, Inc. (NYSE:TE) today reported first-quarter non-GAAP results from continuing operations, which exclude $0.1 million of Emera transaction costs, of $73.8 million, or $0.31 on a per-share basis, compared with $64.5 million, or $0.28 on a per-share basis, in 2015.

First-quarter 2016 net income was $73.8 million, or $0.31 per share, compared with $58.0 million, or $0.25 per share, in the first quarter of 2015. Net income from continuing operations was $73.7 million, or $0.31 per share, in the 2016 first quarter, compared with $63.8 million, or $0.27 per share, for the same period in 2015. The first quarter losses in discontinued operations of $5.8 million in 2015 reflected the operating results and charges associated with TECO Coal, which was sold in 2015.

TECO Energy President and Chief Executive Officer John Ramil said, "Our operating companies performed well in the first quarter, delivering good results, despite the impact on energy sales of an El Niño winter weather pattern. The Florida operations continue to benefit from the state's growing economy, with the number of electric and gas customers up 1.7% and 2.4%, respectively. Our New Mexico Gas operations delivered improved results from better winter weather and a continued focus on cost control. At the same time, we are making good progress to obtain the various approvals needed to close our transaction with Emera, with only the approval by the New Mexico Public Regulation Commission remaining."

Non-GAAP Results

Non-GAAP results in the first quarter and 12-months-ended periods of 2016 and 2015 exclude costs related to the pending acquisition by Emera, and costs associated with the integration and acquisition of New Mexico Gas Co. (NMGC). The table below compares the TECO Energy GAAP net income with the non-GAAP measures used in this release.

Non-GAAP results exclude charges and gains contained in the Results Reconciliation table later in this release. See the Non-GAAP Presentation section and Results Reconciliation table later in this release for reconciliation to GAAP results and a discussion regarding this presentation of non-GAAP results and management's use of this information.

All amounts included in the non-GAAP discussion below are after tax, unless otherwise noted.
  3 months

ended Mar. 31
  12 months

ended Mar. 31

(millions)

2016
 

2015
   

2016
 

2015
Net income $ 73.8 $58.0 $189.3 $138.2
Discontinued operations 0.1   (5.8)       (61.8)   (83.6)
Net income from continuing operations 73.7 63.8 251.1 221.8
Charges 0.1   0.7       14.4   21.9
Non-GAAP Results from continuing
operations $73.8   $64.5       $265.5   $243.7
 

Segment Reporting

The table below includes TECO Energy segment information on a GAAP basis, which includes all charges and gains for the periods shown.

Segment Information
 

(millions)
  3 months

ended Mar. 31
  12 months

ended Mar. 31

Net Income Summary

2016
 

2015
   

2016
 

2015
Tampa Electric $ 50.2 $ 48.2 $243.0 $227.5
Peoples Gas System 13.1 14.6 33.8

35.9
New Mexico Gas Co. (1) 15.2 13.9 25.4 24.5
Other - net (4.8)   (12.9)       (51.1)   (66.1)
Net income from continuing operations 73.7 63.8 251.1 221.8
Discontinued operations (2) 0.1   (5.8)       (61.8)   (83.6)
Total net income $ 73.8   $ 58.0       $189.3   $138.2
 

1. The 12-months-ended 2015 period reflects results after the Sept. 2, 2014, closing of the NMGC acquisition.

2. Discontinued operations for all periods shown include the operating results at TECO Coal, impairment charges and costs associated with the sale of TECO Coal.

All amounts included in the operating company discussions below are after tax, unless otherwise noted.

Tampa Electric

Tampa Electric's net income for the first quarter of 2016 was $50.2 million, compared with $48.2 million for the same period in 2015. Results for the quarter reflected a 1.7% higher average number of customers, and higher energy sales primarily due to the higher number of customers. Results reflected operations and maintenance expense slightly higher than 2015, and higher depreciation and interest expenses. First-quarter net income in 2016 included $5.6 million of Allowance for Funds Used During Construction (AFUDC) equity, which represents allowed equity cost capitalized to construction costs, compared with $3.8 million in the 2015 quarter.

Total degree days in Tampa Electric's service area in the first quarter of 2016 were 3% above normal, but 4% below the 2015 period, when degree days were 6% above normal. Total net energy for load increased 1.7% in the first quarter of 2016, compared with the same period in 2015. In the 2016 period, pretax base revenues were $6.2 million higher than in 2015, driven by customer growth and higher energy sales. The quarter included more than $1 million of higher pretax base revenue from higher base rates, as a result of the 2013 rate case settlement.

While net energy for load is a calendar measurement of retail energy sales rather than a billing-cycle measurement, the quarterly energy sales shown on the operating statistical summary that accompanies this earnings release reflect the energy sales based on billing cycles, which can vary period to period. Retail energy sales to residential and commercial customers increased primarily from weather and customer growth. Sales to non-phosphate industrial customers increased due to the strength of the Tampa area economy. Sales to lower-margin industrial-phosphate customers decreased as self-generation by those customers increased.

Operations and maintenance expense, excluding all Florida Public Service Commission (FPSC)-approved cost-recovery clauses, was slightly higher than in the 2015 quarter, reflecting higher costs to safely and reliably operate and maintain the generating, transmission and distribution systems, essentially offset by lower employee-related costs, primarily due to the lower level of short-term incentive accruals for all employees in 2016 compared to 2015. Depreciation and amortization expense increased $2.0 million in 2016, as a result of normal additions to facilities to reliably serve customers, and interest expense increased $0.7 million due to higher long-term debt balances.

Peoples Gas

Peoples Gas System (PGS) reported net income of $13.1 million for the first quarter, compared with $14.6 million in the 2015 quarter. Average customer growth was 2.4% in the quarter. Therm sales to residential customers decreased as a result of mild winter weather that was partially offset by customer growth. Sales to commercial customers increased due to customer growth from the stronger economy and increased sales of compressed natural gas to vehicle fleets. Sales to power-generation customers and off-system sales increased, reflecting higher levels of operation by gas-fired generation in the state due to lower natural gas prices. First-quarter results in 2016 reflected non-fuel operations and maintenance expense $1.0 million higher than in 2015, driven by higher operating and compliance costs, partially offset by lower employee-related costs, primarily due to the lower level of short-term incentive accruals for all employees in 2016 compared to 2015. Depreciation and amortization increased slightly due to normal additions to facilities to serve customers.

NMGC

NMGC reported first-quarter net income of $15.2 million, compared with $13.9 million in the 2015 period. Results reflected the benefit of heating degree days that were almost 3% higher than 2015, but nearly 7% below normal. Growth in the average number of customers in the 2016 quarter was 0.6%. Operating and maintenance expense was slightly lower from acquisition synergies and a focus on cost control. Results included $1.9 million of pretax rate credits to customers under the Certification of Stipulation approved by the New Mexico Public Regulation Commission (NMPRC) in 2014.

Other - net

The first quarter 2016 non-GAAP cost from continuing operations for Other - net of $4.7 million excluded $0.1 million of costs associated with the pending Emera transaction, compared with the non-GAAP cost of $12.2 million in 2015, which excluded $0.7 million of NMGC-related integration costs. First-quarter results in 2016 reflected a $5.8 million tax benefit due to an accounting rule change related to stock-based incentive compensation, and lower interest expense as a result of refinancing debt maturities. The GAAP cost from continuing operations for Other - net in the first quarter of 2016 was $4.8 million, compared with a cost of $12.9 million in 2015.

Discontinued Operations

The sale of TECO Coal closed in September 2015. The $0.1 million first quarter gain recorded in discontinued operations reflects a refund of prepaid costs recorded in the Other - net segment, compared with a $5.8 million loss in the 2015 period, which reflected TECO Coal's operating results prior to its sale.

Emera Acquisition Progress
  • On Oct. 19, 2015, TECO Energy and Emera filed for approval of the merger with the NMPRC Docket No. 15-00327-UT. On April 11, TECO Energy and Emera announced that they had filed an unopposed stipulation with the NMPRC, reflecting a settlement reached with intervening parties in the acquisition case currently pending before the NMPRC for approval of Emera's acquisition of TECO Energy and the indirect acquisition of NMGC. This stipulation was subject to a public hearing before the hearing examiner, which was held May 2. A final recommendation by the hearing examiner and final approval of the merger by the NMPRC are required.
  • On Dec. 3, 2015, TECO Energy shareholders approved the merger with Emera.
  • On Jan. 20, 2016, the Federal Energy Regulatory Commission (FERC) issued an order authorizing the merger, finding that it is consistent with the public interest.
  • On Feb. 8 the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR) expired without comment.
  • On March 23, Emera announced that the Committee on Foreign Investment in the United States (CFIUS) had completed its review of the acquisition of TECO Energy and had determined that there are no unresolved national security concerns with respect to the acquisition.

Non-GAAP Presentation

Management believes it is helpful to present a non-GAAP measure of performance that reflects the ongoing operations of TECO Energy's businesses and that allows investors to better understand and evaluate the business as it is expected to operate in future periods.

Management and the board of directors use non-GAAP measures as a tool for measuring the company's performance, for making decisions that are dependent upon the profitability of the company's various operating units, and for determining levels of incentive compensation.

The non-GAAP measures of financial performance used by the company are not measures of performance under accounting principles generally accepted in the United States and should not be considered an alternative to net income or other GAAP figures as an indicator of the company's financial performance or liquidity. TECO Energy's non-GAAP presentation of results from operations may not be comparable to similarly titled measures used by other companies.

The Results Reconciliation table below presents non-GAAP financial results after eliminating the effects of identified charges and gains. This provides investors additional information to assess the company's results and future earnings potential.

Results Reconciliation

(millions)
  3 months ended

March 31
  12 months ended

March 31

2016
 

2015
   

2016
 

2015
GAAP net income $73.8 $58.0 $189.3 $138.2
Discontinued operations 0.1   (5.8)       (61.8)   (83.6)
Net income from continuing operations

73.7
 

63.8
     

251.1
 

221.8
Add consolidated deferred tax balance adjustment (net)

--

--

--

6.7
Add Emera transaction related costs 0.1 -- 13.2 --
Add costs associated with the
acquisition and integration of NMGC --   0.7       1.2   15.2
Total charges 0.1   0.7       14.4   21.9
Non-GAAP results (1) $73.8   $64.5       $265.5   $243.7
 

(1) A non-GAAP financial measure is a numerical measure that includes or excludes amounts, or is subject to adjustments that have the effect of including or excluding amounts, from the most directly comparable GAAP measure.

TECO Energy Inc. (NYSE:TE) is an energy-related holding company with regulated electric and gas utilities in Florida and New Mexico. Tampa Electric serves nearly 725,000 customers in West Central Florida; Peoples Gas System serves nearly 365,000 customers across Florida; and New Mexico Gas Co. serves more than 515,000 customers across New Mexico.

Note: This press release contains forward-looking statements, which are subject to the inherent uncertainties in predicting future results and conditions. Actual results may differ materially from those forecasted. The forecasted results are based on the company's current expectations and assumptions, and the company does not undertake to update that information or any other information contained in this press release, except as may be required by law. Factors that could impact actual results include: the ability to successfully close the merger with Emera on the anticipated schedule, if at all; regulatory actions by federal, state or local authorities; the ability to successfully implement the integration plans for NMGC and generate the expected financial results; unexpected capital needs or unanticipated reductions in cash flow that affect liquidity; the ability to access the capital and credit markets when required; general economic conditions affecting customer growth and energy sales at the utility companies; economic conditions affecting the Florida and New Mexico economies; weather variations and customer energy usage patterns affecting sales and operating costs at the utilities and the effect of weather conditions on energy consumption; the effect of extreme weather conditions or hurricanes; general operating conditions; input commodity prices affecting cost at all of the operating companies; natural gas demand at the utilities; and the ability of TECO Energy's subsidiaries to operate equipment without undue accidents, breakdowns or failures. Additional information is contained under "Risk Factors" in TECO Energy, Inc.'s Annual Report on Form 10-K for the period ended Dec. 31, 2015.
Summary Information (as of March 31)
(Millions except per-share amounts)   Three Months

Ended
  Twelve Months

Ended
2016     2015       2016     2015
Revenues $659.5     $693.0       $2,710.0     $2,681.5
Net income from continuing operations

$73.7
   

$63.8
   

$251.1
   

$221.8
Net income from discontinued operations

0.1
   

(5.8)
     

(61.8)
   

(83.6)
Net income $ 73.8     $58.0       $189.3     $138.2
 
Earnings per share from continuing operations- basic

$ 0.31

$0.27

$1.07

$0.97
Earnings per share from discontinued operations - basic --    

(0.02)
     

(0.26)
   

(0.37)
Total earnings per share - basic $0.31     $0.25       $0.81     $0.60
 
Total earnings per share - diluted

$0.31

$0.25

$0.81

$0.60
Average common shares outstanding - basic

234.0

232.8

233.4

227.2
Average common shares outstanding - diluted

235.2

233.5

235.0

227.8
 

MARCH 2016

Figures appearing in these statements are presented as general information and not in connection with any sale or offer to sell or solicitation of an offer to buy any securities, nor are they intended as a representation by the company of the value of its securities. All figures reported are subject to adjustments as the annual audit by independent accountants may determine to be necessary and to the explanatory notes affecting income and balance sheet accounts contained in the company's Annual Report on Form 10-K. Reference should also be made to information contained in that and other reports filed by TECO Energy, Inc. and Tampa Electric Company with the Securities and Exchange Commission.
TECO ENERGY, Inc.
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(All significant intercompany transactions have been eliminated in the consolidated financial statements.)
 
  Three Months Ended   Twelve Months Ended
Mar. 31, Mar. 31,
(millions except share data)   2016   2015       2016   2015
     
Revenues
Regulated electric and gas $656.3 $689.9 $2,698.1 $2,671.5
Unregulated   3.2   3.1       11.9   10.0
Total revenues   659.5   693.0       2,710.0   2,681.5
Expenses
Regulated operations & maintenance
Fuel 115.2 144.1 609.7 686.9
Purchased power 14.4 17.1 76.1 70.3
Cost of natural gas sold 96.8 103.0 265.4 265.5
Other 142.3 143.7 611.8 570.9
Operations & maintenance other expense 0.0 1.6 21.2 28.0
Depreciation and amortization 89.8 85.5 353.3 325.0
Taxes, other than income   52.9   51.8       208.4   199.0
Total expenses   511.4   546.8       2,145.9   2,145.6
Income from operations   148.1   146.2       564.1   535.9
Other income (expense)
Allowance for other funds used during construction 5.7 3.8 19.3 12.0
Other income   1.5   1.6       3.3   3.0
Total other income   7.2   5.4       22.6   15.0
Interest charges
Interest expense 48.9 49.8 194.3 185.2
Allowance for borrowed funds used during construction   (3.0)   (1.9)       (9.8)   (5.8)
Total interest charges   45.9   47.9       184.5   179.4
Income before provision for income taxes 109.4 103.7 402.2 371.5
Provision for income taxes   35.7   39.9       151.1   149.7
Income from continuing operations 73.7 63.8 251.1 221.8
Discontinued operations
Income (loss) from discontinued operations 0.2 (9.6) (96.5) (136.3)
Provision (benefit) for income taxes   0.1   (3.8)       (34.7)   (52.7)
Income (loss) from discontinued operations, net   0.1   (5.8)       (61.8)   (83.6)
Net income   $73.8   $58.0       $189.3   $138.2
 
 
Average common shares outstanding - basic (millions) 234.0 232.8 233.4 227.2
Average common shares outstanding - diluted (millions) 235.2 233.5 235.0 227.8
 
Earnings per average common share outstanding:
Earnings per share from continuing operations -- basic $0.31 $0.27 $1.07 $0.97
Earnings per share from continuing operations -- diluted $0.31 $0.27 $1.07 $0.97
 
Earnings per share from discontinued operations -- basic $0.00 ($0.02) ($0.26) ($0.37)
Earnings per share from discontinued operations -- diluted $0.00 ($0.02) ($0.26) ($0.37)
 
Earnings per share attributable to TECO Energy -- basic $0.31 $0.25 $0.81 $0.60
Earnings per share attributable to TECO Energy -- diluted $0.31 $0.25 $0.81 $0.60
 
TECO ENERGY, Inc.
CONSOLIDATED BALANCE SHEETS (Unaudited)
(All significant intercompany transactions have been eliminated in the consolidated financial statements.)
         
  Mar. 31,   Dec. 31,
(millions)   2016   2015
 
Assets
Current assets
Cash and cash equivalents $46.1 $23.8
Receivables 240.1 280.7
Inventories at average cost
Fuel 118.3 113.4
Materials and supplies 77.1 76.8
Deferred income taxes 0.0 0.0
Prepayments and other current assets 25.4 30.8
Regulatory assets 40.2 44.8
Assets held for sale   0.0   0.0
Total current assets   547.2   570.3
Property, plant and equipment
Utility plant in service
Electric 7,328.3 7,270.3
Gas 2,154.1 2,113.8
Construction work in progress 816.9 794.7
Other property   16.1   15.9
Property plant and equipment at original cost 10,315.4 10,194.7
Accumulated depreciation   (2,762.4)   (2,712.9)
Total property, plant and equipment, net   7,553.0   7,481.8
Other assets
Regulatory assets 393.4 395.2
Goodwill 408.4 408.4
Deferred charges and other assets 79.1 77.8
Assets held for sale   0.0   0.0
Total other assets   880.9   881.4
Total assets   $8,981.1   $8,933.5
 
Liabilities and capital
Current liabilities
Long-term debt due within one year $83.3 $333.3
Notes payable 513.0 247.0
Accounts payable 189.5 255.4
Other current liabilities 25.2 22.6
Customer deposits 176.7 182.1
Derivative liabilities 22.3 24.1
Interest accrued 54.0 36.2
Taxes accrued 28.2 13.2
Regulatory liabilities 108.4 84.8
Liabilities associated with assets held for sale   0.0   0.0
Total current liabilities   1,200.6   1,198.7
Other liabilities
Deferred income taxes 607.0 570.7
Investment tax credits 10.4 10.5
Regulatory liabilities 709.4 715.8
Derivative liabilities 0.8 2.1
Deferred credits and other liabilities 380.9 387.5
Liabilities associated with assets held for sale 0.0 0.0
Long-term debt, less amount due within one year   3,489.7   3,489.2
Total other liabilities   5,198.2   5,175.8
Total liabilities 6,398.8 6,374.5
Capital
Common equity 235.5 235.3
Additional paid in capital 1,894.8 1,894.5
Retained earnings 463.5 441.4
Accumulated other comprehensive loss   (11.5)   (12.2)
Total capital   2,582.3   2,559.0
Total liabilities and capital   $8,981.1   $8,933.5
 
Book Value Per Share $10.96 $10.88
 
TECO ENERGY, Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(All significant intercompany transactions have been eliminated in the consolidated financial statements.)
 
  Three Months Ended       Twelve Months Ended
Mar. 31, Mar. 31,
(millions)   2016   2015       2016   2015
   
Cash flows from operating activities
Net income $73.8 $58.0 $189.3 $138.2
 
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization 89.8 85.9 354.1 342.9
Deferred income taxes & Investment tax credits 36.1 36.0 117.6 96.7
Allowance for other funds used during construction (5.7) (3.8) (19.3) (12.0)
Non-cash stock compensation 3.0 3.9 12.2 12.9
Loss (gain) on disposals of business / assets, pretax 0.0 0.0 13.2 (0.1)
Deferred recovery clause 26.4 (5.7) 58.5 (23.5)
Asset impairment, pretax 0.0 0.0 78.6 115.9
Receivables, less allowance for uncollectibles 40.6 51.0 25.7 (3.7)
Inventories (5.2) (15.7) (12.1) (3.1)
Prepayments and other current assets 2.8 (10.9) 5.6 (8.0)
Taxes accrued 18.1 1.7 0.5 (12.7)
Interest accrued 17.8 17.8 (3.7) 2.2
Accounts payable (59.1) (63.5) (57.2) (14.8)
Other   (6.8)   (7.7)       (66.5)   (5.0)
    231.6   147.0       696.5   625.9
 
Cash flows from investing activities
Capital expenditures (168.0) (156.2) (751.5) (726.1)
Purchase of a business, net of cash acquired 0.0 0.0 0.0 (751.5)
Net proceeds from sale of business / assets 0.0 (0.1) 0.1 (0.1)
Other investments   (0.2)   (0.1)       (0.3)   (8.0)
    (168.2)   (156.4)       (751.7)   (1,485.7)
 
Cash flows from financing activities
Dividends and dividend equivalents (54.3) (53.0) (213.0) (204.2)
Proceeds from sale of common stock 3.9 2.8 8.5 303.5
Proceeds from long-term debt 0.0 0.0 499.7 563.6
Repayment of long-term debt / Purchase in lieu of redemption (250.0) 0.0 (524.5) (83.3)
Net increase (decrease) in short-term debt (maturities of 90 days or less) (134.0) 67.0 (93.0) 177.0
Proceeds from other short-term debt (maturities over 90 days) 400.0 0.0 400.0 0.0
Other financing activities   (6.7)   0.0       (9.2)   (1.0)
    (41.1)   16.8       68.5   755.6
 
Net increase (decrease) in cash and cash equivalents 22.3 7.4 13.3 (104.2)
Cash and cash equivalents at beginning of period   23.8   25.4       32.8   137.0
Cash and cash equivalents at end of period   $46.1   $32.8       $46.1   $32.8
 
 
Supplemental disclosure of non-cash activities
Debt assumed in NMGI acquisition $0.0 $0.0 $0.0 200.0
Change in accrued capital expenditures - excluded above ($6.0) $11.5 ($9.5) $10.3
 
TECO ENERGY, Inc.
SEGMENT INFORMATION (Unaudited)
 
                                                         
(millions)   Tampa       Peoples       TECO                         TECO
        Electric       Gas       Coal       NMGC       Other       Eliminations       Energy
Three months ended Mar. 31,
2016   Revenues - outsiders $ 423.4 $ 126.8 $ -- $ 106.6 $ 2.7 $ -- $ 659.5
Sales to affiliates     1.1         4.4         --           --         --           (5.5 )         --  
Total revenues 424.5 131.2 -- 106.6 2.7 (5.5 ) 659.5
Depreciation and amortization 66.1 14.8 -- 8.4 0.5 -- 89.8
Total interest charges (2) 23.8 3.7 -- 3.0 15.6 (0.2 ) 45.9
Allocated interest expense (2) -- -- -- -- 0.2 (0.2 ) --
Provision (Benefit) for income taxes 27.8 8.9 -- 9.7 (10.7 ) -- 35.7
Net income (loss) from continuing operations 50.2 13.1 -- 15.2 (4.8 ) -- 73.7
Income (loss) from discontinued operations, net of tax (3) -- -- -- -- 0.1 -- 0.1
    Net income (loss) (1)   $ 50.2       $ 13.1       $ --         $ 15.2       $ (4.7 )       $ --         $ 73.8  
2015 Revenues - outsiders $ 449.8 $ 121.7 $ -- $ 119.0 $ 2.5 $ -- $ 693.0
Sales to affiliates     0.8         1.2         --           --         --           (2.0 )         --  
Total revenues 450.6 122.9 -- 119.0 2.5 (2.0 ) 693.0
Depreciation and amortization 62.9 13.9 -- 8.4 0.3 -- 85.5
Total interest charges (2) 23.5 3.5 -- 3.3 17.9 (0.3 ) 47.9
Allocated interest expense (2) -- -- -- -- 0.3 (0.3 ) --
Provision (Benefit) for income taxes 27.4 9.2 -- 9.0 (5.7 ) -- 39.9
Net income (loss) from continuing operations 48.2 14.6 -- 13.9 (12.9 ) -- 63.8
Income (loss) from discontinued operations, net of tax (3) -- -- (6.0 ) -- 0.2 -- (5.8 )
    Net income (loss) (1)   $ 48.2       $ 14.6       $ (6.0 )       $ 13.9       $ (12.7 )       $ --         $ 58.0  
Twelve months ended Mar. 31,
2016 Revenues - outsiders $ 1,988.6 $ 406.6 $ -- $ 304.2 $ 10.6 $ -- $ 2,710.0
Sales to affiliates     3.7         9.2         --           --         --           (12.9 )         --  
Total revenues 1,992.3 415.8 -- 304.2 10.6 (12.9 ) 2,710.0
Depreciation and amortization 260.1 57.6 -- 33.9 1.7 -- 353.3
Total interest charges (2) 95.4 14.7 -- 12.7 62.9 (1.2 ) 184.5
Allocated interest expense (2) -- -- -- -- 1.2 (1.2 ) --
Provision (Benefit) for income taxes 144.1 21.5 -- 16.1 (30.6 ) -- 151.1
Net income (loss) from continuing operations 243.0 33.8 -- 25.4 (51.1 ) -- 251.1
Income (loss) from discontinued operations, net of tax (3) -- -- (63.6 ) -- 1.8 -- (61.8 )
    Net income (loss) (1)   $ 243.0       $ 33.8       $ (63.6 )       $ 25.4       $ (49.3 )       $ --         $ 189.3  
2015 Revenues - outsiders $ 2,016.8 $ 397.7 $ -- $ 256.5 $ 10.5 $ -- $ 2,681.5
Sales to affiliates     1.6         2.1         --           --         0.2           (3.9 )         --  
Total revenues 2,018.4 399.8 -- 256.5 10.7 (3.9 ) 2,681.5
Depreciation and amortization 249.4 54.6 -- 19.4 1.6 -- 325.0
Total interest charges (2) 94.2 13.9 -- 7.6 68.0 (4.3 ) 179.4
Allocated interest expense (2) -- -- -- -- 4.3 (4.3 ) --
Provision (Benefit) for income taxes 134.0 22.7 -- 16.1 (23.1 ) -- 149.7
Net income (loss) from continuing operations 227.5 35.9 -- 24.5 (66.1 ) -- 221.8
Income (loss) from discontinued operations, net of tax (3) -- -- (86.5 ) -- 2.9 -- (83.6 )
    Net income (loss) (1)   $ 227.5       $ 35.9       $ (86.5 )       $ 24.5       $ (63.2 )       $ --         $ 138.2  
 
(1 ) Results are based on GAAP net income. For a complete reconciliation between GAAP and non-GAAP items, see Results Reconciliation in Earnings Release.
(2 ) Segment net income is reported on a basis that includes internally allocated financing costs. Internally allocated costs were at pretax rates of 6.00% for April 2014 through March 2016.
(3 ) All periods have been adjusted to reflect the reclassification of results from operations to discontinued operations for TECO Coal and certain charges at Other, including Parent and TECO Diversified, that directly relate to TECO Coal and TECO Guatemala.
 
TAMPA ELECTRIC COMPANY
ELECTRIC OPERATING STATISTICS (Unaudited)
                                               
  Operating Revenues*             Sales -- Kilowatt-hours*      
Three Months Ended Mar. 31,       Percent       Percent
      2016           2015       Change       2016       2015       Change
 
Residential $ 217,436 $ 213,401 1.9 1,914,557 1,839,405 4.1
Commercial 132,783 132,988 (0.2 ) 1,387,966 1,350,118 2.8
Industrial -- Phosphate 13,099 13,421 (2.4 ) 163,531 167,726 (2.5 )
Industrial -- Other 25,475 24,760 2.9 297,259 279,416 6.4
Other sales of electricity 39,517 40,528 (2.5 ) 401,296 400,065 0.3
                                             
428,310 425,098 0.8 4,164,609 4,036,730 3.2
 
Deferred and other revenues (19,433 ) 7,468 (360.2 ) -- -- --
Provision for Revenue Stipulation -- -- -- -- -- --
Sales for resale 1,399 1,885 (25.8 ) 50,317 53,508 (6.0 )
Other operating revenue 14,232 16,104 (11.6 ) -- -- --
SO 2 Allowance Sales -- -- -- -- -- --
NOx Allowance Sales     --           --       --         --       --       --  
    $ 424,508         $ 450,555       (5.8 )       4,214,926       4,090,238       3.0  
 
Average customers     726,142           714,028       1.7         --       --       --  
 
Retail Net Energy For Load                           4,317,006       4,243,704       1.7  
 
Total Degree Days                           602       630       (4.4 )
 
 
                                             
Operating Revenues* Sales -- Kilowatt-hours*
Twelve Months Ended Mar. 31, Percent Percent
      2016           2015       Change       2016       2015       Change
 
Residential $ 1,044,299 $ 1,007,429 3.7 9,120,173 8,672,349 5.2
Commercial 607,798 600,232 1.3 6,338,515 6,141,447 3.2
Industrial -- Phosphate 52,757 56,603 (6.8 ) 651,043 697,030 (6.6 )
Industrial -- Other 107,797 105,027 2.6 1,232,145 1,174,715 4.9
Other sales of electricity 176,179 179,919 (2.1 ) 1,792,477 1,805,161 (0.7 )
                                             
1,988,830 1,949,210 2.0 19,134,353 18,490,702 3.5
 
Deferred and other revenues (55,692 ) 1,935 (2,978.1 ) -- -- --
Provision for Revenue Stipulation -- -- -- -- -- --
Sales for resale 3,234 7,871 (58.9 ) 112,097 206,256 (45.7 )
Other operating revenue 55,848 59,377 (5.9 ) -- -- --
SO 2 Allowance Sales -- -- -- -- -- --
NOx Allowance Sales     --           --       --         --       --       --  
    $ 1,992,220         $ 2,018,393       (1.3 )       19,246,450       18,696,958       2.9  
 
Average customers     721,742           709,088       1.8         --       --       --  
 
Retail Net Energy For Load                           20,176,559       19,371,798       4.2  
 
Total Degree Days                           4,701       4,098       14.7  
 
* in thousands
 
PEOPLES GAS SYSTEM
GAS OPERATING STATISTICS (Unaudited)
                                             
  Operating Revenues*             Therms*      
Three Months Ended Mar. 31,       Percent       Percent
    2016       2015       Change       2016       2015       Change
 
By Customer Segment:
Residential $ 50,501 $ 49,258 2.5 32,935 34,362 (4.2)
Commercial 42,796 41,585 2.9 141,130 138,171 2.1
Industrial 3,295 3,242 1.6 83,451 76,123 9.6
Off System Sales 12,882 7,803 65.1 53,877 23,421 130.0
Power generation 2,089 1,936 7.9 190,569 184,609 3.2
Other revenues   16,601       16,125       3.0       --       --       --
    $ 128,164       $ 119,949       6.8       501,962       456,686       9.9
 
By Sales Type:
System supply $ 75,427 $ 69,434 8.6 94,095 66,284 42.0
Transportation 36,136 34,390 5.1 407,867 390,402 4.5
Other revenues   16,601       16,125       3.0       --       --       --
    $ 128,164       $ 119,949       6.8       501,962       456,686       9.9
 
Average customers   367,530       359,043       2.4       --       --       --
 
 
                                             
Operating Revenues* Therms*
Twelve Months Ended Mar. 31, Percent Percent
    2016       2015       Change       2016       2015       Change
 
By Customer Segment:
Residential $ 138,268 $ 143,631 (3.7) 73,466 81,867 (10.3)
Commercial 140,012 139,796 0.2 473,735 467,729 1.3
Industrial 13,029 12,709 2.5 296,298 278,422 6.4
Off System Sales 54,901 38,710 41.8 196,886 92,070 113.8
Power generation 7,351 6,828 7.7 764,247 672,471 13.6
Other revenues   50,968       48,611       4.8       --       --       --
    $ 404,529       $ 390,285       3.6       1,804,632       1,592,559       13.3
 
By Sales Type:
System supply $ 231,339 $ 223,508 3.5 296,483 203,063 46.0
Transportation 122,222 118,166 3.4 1,508,149 1,389,496 8.5
Other revenues   50,968       48,611       4.8       --       --       --
    $ 404,529       $ 390,285       3.6       1,804,632       1,592,559       13.3
 
Average customers   363,299       355,685       2.1       --       --       --
 
* in thousands
NEW MEXICO GAS COMPANY
GAS OPERATING STATISTICS (Unaudited)
 
  Operating Revenues*             Therms*      
Three Months Ended Mar. 31,       Percent       Percent
    2016       2015       Change       2016       2015       Change
 
By Customer Segment:
Residential $ 77,742 $ 87,458 (11.1) 122,600 121,240 1.1
Commercial 19,817 23,207 (14.6) 42,008 41,056 2.3
Industrial 169 218 (22.5) 433 425 1.9
Off System Sales 611 308 98.4 3,870 1,200 222.5
On System Transportation 6,591 6,092 8.2 95,072 84,734 12.2
Off System Transportation 212 205 3.4 11,131 10,308 8.0
Other revenues   1,471       1,487       (1.1)       --  

 
  --       --
    $ 106,613       $ 118,975       (10.4)       275,114       258,963       6.2
 
By Sales Type:
System supply $ 98,339 $ 111,191 (11.6) 168,911 163,921 3.0
Transportation 6,803 6,297 8.0 106,203 95,042 11.7
Other revenues   1,471       1,487       (1.1)       --       --       --
    $ 106,613  

 
  $ 118,975       (10.4)       275,114       258,963       6.2
 
Average customers   519,714       516,785       0.6                        
 
Total Degree Days                           1,970       1,920       2.6
 
 
                                             
Operating Revenues* Therms*
Twelve Months Ended Mar. 31, Percent Percent
    2016       2015 (1)       Change       2016       2015 (1)       Change
 
By Customer Segment:
Residential $ 219,450 $ 256,290 (14.4) 292,596 282,727 3.5
Commercial 56,208 73,308 (23.3) 105,311 105,848 (0.5)
Industrial 1,154 1,665 (30.7) 2,565 2,719 (5.7)
Off System Sales 611 308 98.4 3,870 1,200 222.5
On System Transportation 19,613 19,116 2.6 339,010 316,694 7.0
Off System Transportation 909 884 2.8 48,019 46,227 3.9
Other revenues   6,227       6,479       (3.9)       --       --       --
    $ 304,172       $ 358,050       (15.0)       791,371       755,415       4.8
 
By Sales Type:
System supply $ 277,423 $ 331,571 (16.3) 404,342 392,494 3.0
Transportation 20,522 20,000 2.6 387,029 362,921 6.6
Other revenues   6,227       6,479       (3.9)       --       --       --
    $ 304,172       $ 358,050       (15.0)       791,371       755,415       4.8
 
Average customers   516,799       513,197       0.7                        
 
Total Degree Days                           4,139       4,012       3.2
 
(1) Information presented for 2014 is for comparative purposes only, as this was before the date of acquisition (Sep. 2, 2014).
* in thousands

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