Skip to main content Q2 2013 EARNINGS CALL – Black Hills Corporation Investor Presentation | Shale Experts
Loading...
Pm

Q2 2013 EARNINGS CALL – Black Hills Corporation

Black Hills Corporation · Aug 6, 2013 · 56 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 1
    Nathan Woods, Black Hills Power 2013 Second Quarter Review August 6, 2013
  2. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 2
    Discussion Agenda Second Quarter Review David Emery Chairman, President and CEO Financial Update Tony Cleberg Executive Vice President and CFO Strategic Overview David Emery Chairman, President and CEO Q&A Second…
  3. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 3
    Q2 2013 Review Pueblo Airport Generating Station near Pueblo, Colo. Second Quarter Review Aug 6, 2013 4
  4. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 4
    Q2 2013 Highlights Business Environment Colder weather in gas utility service territories compared to same period last year and compared to normal weather Utilities Cheyenne Light/Black Hills Power construction on Cheyenne Prairie…
  5. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 5
    Q2 2013 Highlights Utilities continued Colorado Electric issued request for proposals for up to 30 MW of wind energy on April 23 Bids received; independent evaluation completed and bid results submitted to commission Hearing…
  6. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 6
    Q2 2013 Highlights Power Generation Announced on May 7 the sale of CT II, a 40 MW, natural gas-fired turbine located at Gillette Energy Complex, to City of Gillette for approximately 22 million in 2014 Includes 20-year economy energy…
  7. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 7
    Q2 2013 Highlights Corporate Activities Standard & Poors Rating Services raised its corporate credit rating on Black Hills Corp. to BBB from BBB-, with a stable outlook Fitch Ratings raised its rating on Black Hills Corp. to BBB from…
  8. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 8
    Q2 2013 Financial Highlights 21% Growth in EPS, as adjusted Income from Continuing Operations, as adjusted* (in millions) (per share) Key Earnings Drivers 18.3 0.41 Colder than normal weather benefited 15.1 0.34 gas utilities…
  9. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 9
    Q2 2013 Financial Highlights Change in Income from Continuing Operations, as adjusted*, from Prior Year Q2 2012 15.1 (3.6) Electric Utilities 2.0 Gas Utilities 1.1 Power Generation 0.7 Coal Mining 0.4 Oil & Gas 2.6 Corporate…
  10. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 10
    Financial Update Stan Lindholm of Exploration & Production Second Quarter Review Aug 6, 2013 11
  11. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 11
    Earnings Per Share Analysis Q2 2013 Q1 2013 Q4 2012 Q3 2012 Q2 2012 Net income (loss) 0.69 0.97 0.70 0.78 (0.31) Loss (income) from discontinued operations - - - - 0.03 Income (loss) from continuing ops 0.69 0.97 0.70 0.78 (0.28)…
  12. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 12
    Q2 Revenue/Op Income Total Revenue, as adjusted* Electric Util 158.0 (in millions) 149.7 105.8 279.8 Gas Util 70.4 242.4 20.6 Power Gen 19.1 Q2 2013 14.3 Q2 2012 Coal Mining 13.1 11.8 Oil & Gas 20.6 (30.7) Corporate,…
  13. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 13
    Income Statement (in millions, except earnings per share) 2nd QTR Comments 2013 2012 Revenue 279.8 242.4 Gross margin 180.7 178.9 Operating expenses (96.5) (90.0) Increased labor and benefits (cost containment in 2012 and performance…
  14. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 14
    Q2 Utilities - Revenue/Op Income Electric Utilities (in millions) Change Q2 Key Performance Drivers 158.0 149.7 Q2 2013 New rates Q2 2012 Financing riders at CLFP and BHP for Cheyenne Prairie Generating Station 31.5 35.2 Lower…
  15. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 15
    Q2 Non-Regulated Energy - Revenue/Op Income Power Generation (in millions) Change Q2 Key Performance Drivers 20.6 Q2 2013 19.1 Q2 2012 Outage at Wygen I in 2012 Higher fired-hours and higher price from Pueblo Airport plant 8.4…
  16. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 16
    Q2 Non-Regulated Energy - Revenue/Op Income Oil & Gas (in millions) Change Q2 Key Performance Drivers 20.6 Higher average hedged price received for crude oil Q2 2013 11.8 Lower depletion rate Q2 2012 Lower revenue and volumes…
  17. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 17
    Capital Structure (In millions, except for ratios) June 30, March 31, Dec. 31, Sept. 30, June 30, 2013 2013 2012 2012 2012 Capitalization Short-term Debt 355.5 349.6 381.0 553.3 452.6 Long-term Debt 958.6 936.5 938.9 943.0 1,044.9…
  18. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 18
    2013 Earnings Guidance Black Hills reaffirms expected 2013 earnings from continuing operations, as adjusted, to be in the range of 2.20 to 2.40 per share, consistent with our original guidance issued on Nov. 7, 2012 Second Quarter…
  19. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 19
    Growth Operating Income and EPS, as Adjusted* (in millions, except per share amount) 350 2.30** 2.40 2009 2013 EPS CAGR = 13.6% 2.09 300 2.00 250 1.67 1.69 36.2 1.60 1.38 200 5.2 19.0 1.20 150 19.9 0.80 100 210.4 185.0 159.3…
  20. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 20
    Strategic Overview Busch Ranch Wind Farm near Pueblo, Colo. Second Quarter Review Aug 6, 2013 21
  21. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 21
    Strategic Objectives Utility-centered energy company well positioned to build upon a track record of successful utility growth Achieve top-tier operational performance in a culture of continuous improvement Lead industry peers in…
  22. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 22
    Strategic Objective Operating Performance Electric Reliability 63% IMPROVEMENT SINCE 2010 Safety Performance Total Annual Outage Minutes Total Case Incident Rate 4.6 4.3 3.5 BHC 2.1 1.6 1.6 2009 2010 2011…
  23. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 23
    Strategic Objective Operating Performance Power Plant Fleet Availability by Fuel Type Natural Gas Turbine Starting Reliability 100% 100% BHC Industry BHC Industry 96% 96% 92% 92% 88% 88% 84% 84% 80% 80% Coal (61%*) Gas…
  24. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 24
    Strategic Objectives Operating Performance Generation Capacity by Fuel Type Generation Capacity by Fuel Type 1,200 80% % of Generation by Fuel type 1,000 70% MW of Generation 60% 800 50% 600 40% 30% 400 20%…
  25. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 25
    Strategic Objective Earnings Growth Historical and Forecasted Capital Expenditures (in millions)* 490 455 416 384 338 205 340 111 199 95 287 53 127 116 344 285 285 289 217 213 171 2009 2010 2011 2012 2013E 2014E 2015E…
  26. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 26
    Strategic Objective Earnings Growth Capital Investment by Segment (in millions) 2009 2010 2011 2012 2013E* 2014E* 2015E* Generation 168 146 85 72 151 82 30 Transmission 21 28 20 38 36 40 21 Other 53 59 68 57 97 109 77 Subtotal…
  27. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 27
    Strategic Objective Earnings Growth Cheyenne Prairie Generating Station New Generation Helps Meet Growing Demand and New Environmental Regulations Overview: New 132 MW, 237 million generating plant jointly owned by Cheyenne Light and…
  28. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 28
    Strategic Objective Earnings Growth Utilities Regulatory Updates Black Hills Power General rate case filed in South Dakota in Dec. 2012 asking for 13.7 million in annual revenue; hearing scheduled for Oct. 8-11; interim rates, subject…
  29. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 29
    Strategic Objective Earnings Upside Oil and Gas Growth Strategy Prove up and capture value of existing oil and gas properties Prove up probable and possible reserves Capture value through optionality Participate in limited…
  30. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 30
    Strategic Objective Earnings Upside Oil and Gas Mancos Shale Strategy Three successful test wells drilled in 2011 affirmed potential in San Juan and Piceance Basins; second Piceance Basin test well produced condensate and higher Btu…
  31. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 31
    Strategic Objective Dividend Growth Dividend Increased for 43 Consecutive Years 1.55 Dividend yield was 3.1% on June 30, 2013 1.52 1.50 1.48 1.46 1.45 1.44 1.42 Annual Dividend 1.40 Per Share 1.40 1.35 1.30…
  32. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 32
    Strategic Objectives Credit Rating Standard & Poors raised its corporate credit ratings on Black Hills Corp. and Black Hills Power to BBB from BBB- in July 2013; both upgrades issued with stable outlooks Fitch raised its corporate…
  33. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 33
    2013 Scorecard Strategy 2013 Progress and Future Initiatives UTILITIES + Acquire regulated utility properties in our geographic region R Commence construction on Cheyenne Prairie Generating Station (CPGS) (Q2) + Construct additional cost…
  34. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 34
    6th Annual BKH Analyst Day Above m minumu graphic with top docume Align mark to the right with Graphic can right edge of document. be expanded to heights greater than o Sell Side & Buy Side Analysts However, the minimum…
  35. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 35
    Questions Wygen II and Wygen III power plants at the Gillette Energy Complex in Gillette, Wyo. Second Quarter Review Aug 6, 2013 36
  36. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 36
    Appendix Natural gas line installation near White Creek, Neb. Second Quarter Review Aug 6, 2013 37
  37. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 37
    Use of Non-GAAP Financial Measures EBITDA and EBITDA, as adjusted We believe that our presentation of earnings before interest, income taxes, depreciation and amortization (EBITDA) and EBITDA, as adjusted (EBITDA adjusted for special…
  38. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 38
    Use of Non-GAAP Financial Measures Revenue, as adjusted Electric Gas Power Coal Oil and Q2 2013 Revenue, as adjusted Utilities Utilities Generation Mining Gas Corporate Total (in thousands) Revenue 154,338 105,836 1,031 6,807 11,814…
  39. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 39
    Use of Non-GAAP Financial Measures - EBITDA (in millions) Q2 2013 Q2 2012 Income from continuing operations 30.5 (12.3) Depreciation, depletion and amortization 35.2 41.4 Impairment of Oil and Gas assets - 26.9 Interest expense,…
  40. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 40
    Use of Non-GAAP Financial Measures Operating Income, as adjusted (in thousands, pre-tax) Electric Power QTD June 30, 2013 Utilities Gas Utilities Generation Coal Mining Oil and Gas Corporate Total Operating income (loss) 29,119…
  41. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 41
    Use of Non-GAAP Financial Measures Income from Continuing Operations, as adjusted (in thousands, after-tax) Electric Power QTD June 30, 2013 Utilities Gas Utilities Generation Coal Mining Oil and Gas Corporate Total Income (loss) from…
  42. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 42
    Black Hills Corporation Overview A diversified energy company with a tradition of exemplary service and a vision to be the energy partner of choice. Based in Rapid City, SD, with corporate offices in Denver, CO, and Papillion, NE, the…
  43. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 43
    Electric and Gas Utilities Black Hills Power Cheyenne Nebraska Light Gas Iowa Cheyenne Black Hills Gas Light Power Colorado Gas Kansas Colorado Gas Electric Electric Utilities* Natural Gas Utilities* Generate, transmit and…
  44. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 44
    Electric Utility Generation Availability(%) * Excludes KS HDD data since state has weather normalization 95.5 Q2 2013 96.0 842 Q2 2013 98.6 Q1 2013 (Total for all gas service* areas weighted by 96.9 3,306 Q1 2013 Gas…
  45. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 45
    Mitigating Regulatory Recovery Risk Mechanisms reduce regulatory lag and the risk of non-recovery Electric Utility Cost Recovery Mechanisms Jurisdiction Environmental DSM/ Trans- Fuel Cost Trans- Purchased Fixed Cost Financing Cost…
  46. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 46
    Non-Regulated Energy Power Generation* Ownership in three power generation facilities totaling 309 MW Wygen I - 69 MW of a 90 MW coal-fired facility in Gillette, WY CT II - 40 MW combustion turbine in Gillette, WY Pueblo Airport -…
  47. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 47
    Q2 2013 Non-Regulated Update IPP Generation Contract Availability (%) Coal Production Revenue and Expense per Ton Sold Coal-fired plants (Coal in millions of tons and overburden in millions (Units = tons sold plus cubic yards of…
  48. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 48
    Coal Contracts Summary Approximately 50% of coal production sold under contracts that include price adjustments based on actual mining costs plus a return on mine capital investments Most of the remaining 50% of coal production sold…
  49. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 49
    Oil & Gas Exploration & Development Program Williston Basin Powder River Basin Piceance Basin San Juan Basin Note: approximate areas of geologic basins does not reflect BHEP acreage Second Quarter Review Aug 6,…
  50. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 50
    Reserve Data and Net Present Value Reserve calculation at Dec. 31, 2012 Average Price Average Net Oil Net Gas Net Equiv PV10 Oil Price Nat Gas (MBO) (BCF) (BCFE) (MM) Per BBL per MCF PDP* 3.8 54.1 76.9 140.8 85.39 2.25 PNP* 0.1…
  51. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 51
    Piceance Basin Mancos Shale Map Legend Note: Does not include the approximately 20,000 net acres of Mancos Shale leasehold that Black Horizontal Mancos Producing Well Hills will earn by drilling and completing two wells in the…
  52. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 52
    Piceance Basin Mancos Production Second Quarter Review Aug 6, 2013 53
  53. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 53
    San Juan Basin Mancos Shale WPX Rosa Unit Wells Rosa 634B (upper target) Produced 1.99 BCF Rosa 634A (lower target) Produced 1.71 BCF 16 miles BHGR Jicarilla Horizontal Well Jicarilla 434-30 724 (lower target) Produced 1.75…
  54. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 54
    San Juan Basin Mancos Production Gas Production Rate Profile Comparison BH Jicarilla 724 vs. WPX Rosa 634B, 634A 10000 Produced 1.75 BCF Current Rate 1490 MCFD (as of June 2013) MCFD 1000 100 1 2 3 4 5 6 7 8 9 10 11 12…
  55. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 55
    In Millions 0 50 100 150 200 250 300 2013 BHW Proj. Fin. 2014 250MM 9% Note BHW Proj. Fin. Second Quarter Review 2015 275MM Term Loan BHW Proj. Fin. 2016 BHW Proj. Fin. 2017 2018 Aug 6, 2013 Debt…
  56. Q2 2013 EARNINGS CALL – Black Hills Corporation – slide 56

From the store

Browse maps, data & reports in the Shale Experts store