Duke Energy Corporation (holding Company) · NYSE:DUK
Duke Energy Corporation (holding Company) — Q1 2003 Earnings Presentation
15 slides from Duke Energy Corporation (holding Company)'s earnings presentation, Apr 30, 2003
Slide 1: First Quarter Earnings 2003
First Quarter Earnings 2003 Rick Priory Chairman and Chief Executive Officer Robert Brace Executive Vice President and Chief Financial Officer April 30, 2003
Slide 2: 2003 Strategic Directives
2003 Strategic Directives Duke Energy is focused on reducing risks and restructuring for future success: O O Focus on positive net cash generation O Invest in our strongest business sectors O O O Size businesses to market realities O Address merchant energy issues O O O Strengthen relationships with
Slide 3: First Quarter 2003 Earnings per Share
First Quarter 2003 Earnings per Share Q Q Primary Drivers for First Quarter 2003 O O Upsides X X Favorable Favorable weather weather conditions conditions and and $0.48 $0.43 increased increased wholesale wholesale power power sales sales for for Reported Before Franchised Franchised Electric Electr
Slide 4: Franchised Electric
Franchised Electric Segment EBIT Q Q First Quarter 2003 ($ in millions) $454 O O Higher residential and commercial sales driven by colder weather $384 O O Wholesale power sales increased due to favorable weather and higher gas prices in the region O O Storm costs of $35 million O O Clean Air amortiz
Slide 5: Natural Gas Transmission
Natural Gas Transmission Segment EBIT ($ in millions) Q Q First Quarter 2003 $423 O O Additional two months of earnings from Westcoast of approximately $135 million O O Incremental earnings from $266 business expansion projects O O Sale of Northern Border units contributed $14 million in 1Q02 and 1Q
Slide 6: Duke Energy North America
Duke Energy North America Segment EBIT ($ in millions) Q Q First Quarter 2003 O O Lower earnings from proprietary trading $54 X X Exiting Exiting this this business business activity activity X X Reducing Reducing collateral collateral requirements requirements O O Increased depreciation due to $23
Slide 7: Duke Energy North America Gross Margin
Duke Energy North America Gross Margin ($ in millions) 1Q03 2Q - 4Q03 Total 2003 Total Gross Margin $ 193 $ 832 * $ 1,025 Total Operating Expenses (170) (655) (825) DENA Segment Segment EBIT EBIT $$ 23 23 $$ 177 177 $$ 200 200 * Includes $470 million of low-risk gross margin 7
Slide 8: Field Services
Field Services Segment EBIT ($ in millions) Q Q First Quarter 2003 O O Higher Higher NGL NGL pricing pricing for for the the quarter quarter of of 58¢ 58¢ compared compared withwith 31¢ 31¢ last last year, year, offset offset by by higher higher $35 natural $33 natural gas gas prices prices and and
Slide 9: International Energy
International Energy Segment EBIT ($ in millions) Q Q First Quarter 2003 O O Decrease Decrease primarily primarily due due to to non- non- recurring recurring charge charge of of $11 $11 million million $57 $54 related related to to timing timing of of revenue revenue recognition recognition associa
Slide 10: 1Q03 Segment Earnings Before Interest and Taxes
1Q03 Segment Earnings Before Interest and Taxes Segment EBIT Q Q Other Operations is comprised of: ($ in millions) $930 Other Operations O O Ongoing – Crescent $706 Resources, Duke/Fluor DEI Daniel and DukeNet DENA O O Exiting – Duke Energy Merchants, Duke Capital Field Services Partners Gas Q Q Ful
Slide 11: 2003 Non-Strategic Asset Sales
2003 Non-Strategic Asset Sales ($ in millions) After-tax Annual Annual Gross Cash EBIT Operating Proceeds Proceeds Reduction Cash Announced/Closed Empire Pipeline $ 240 (1) American Ref-Fuel 306 Alliance/Aux Sable 245 Northern Border units 24 TEPPCO units 114 DCP loan monetization 198 Total $ 1,127
Slide 12: Liquidity Position
Liquidity Position (as of April 21, 2003) Duke Duke Energy Capital Other * Credit Facilities $950 million $1.9 billion $1.45 billion n/a $790 million n/a LOC Facilities TOTAL CAPACITY $5.1 billion CP Outstanding $450 million $475 million $300 million LOC Outstanding n/a $550 million n/a n/a n/a $250
Slide 13: Trading Disclosures
Trading Disclosures as of March 31, 2003 Q Q Daily Value at Risk (DVaR): Favorable or unfavorable impact of one day’s price movement on the existing portfolio O 95% confidence level, one-day holding period, two-tailed O O Average DVaR for 1Q03: O $21 million O Increase due to natural gas price spike
Slide 14: Summary
Summary Q Q Solid progress toward achieving 2003 goals O O Regulated businesses will provide strong earnings and cash flows O O Debt reductions expected to reach $1.8 billion O O Continued focus on reducing capex and operating expenses O O Exiting proprietary trading Q Q Remain confident and committ
Slide 15: Q&A
Q&A