2011 Fourth Quarter and Full Year Review February 3, 2012
Discussion Agenda Fourth Quarter and David Emery Chairman, President and CEO Full Year Review Financial Update Tony Cleberg Executive Vice President and CFO Strategic Overview David Emery Chairman, President and CEO…
Q4 and Full Year Review 4
Q4 2011 Summary Income from continuing operations, as adjusted, 19.7 million or 0.46 per share compared to 17.4 million or 0.44 per share in Q4 2010 Utilities Non-Regulated Energy Income from continuing operations, as adjusted, was…
2011 Full Year Summary Income from continuing operations, as adjusted, 67.7 million or 1.69 per share compared to 64.8 million or 1.67 per share in 2010 Utilities Non-Regulated Energy Income from continuing operations, as adjusted, was…
FY 2011 Utility Highlights Successful execution of Strategic Plan in 2011 will yield earnings growth in 2012 and beyond Completed Colorado Electrics 180 MW power plant project for 230 million Began serving customers on Jan. 1, 2012…
FY 2011 Non-Regulated Highlights Strategy Refinement for Non- Regulated Energy Group Oil and Gas Completed strategy review and new leader joined BHEP in mid-Dec. Mancos shale test drilling program showing promising results; reserve…
FY 2011 Corporate Highlights Recognized non-cash unrealized mark-to-market loss on certain interest rate swaps of 42.0 million in 2011 compared to 15.2 million loss in 2010 On Nov. 1, 2011 settled Equity Forward Agreements by issuing…
Income Statement (in millions, except per share amounts) Quarter to Date Year to Date 2011 2010 2011 2010 Revenue 356.0 315.0 1,272.2 1,219.7 Gross Margin 186.7 168.7 697.2 652.7 Operating expense (96.5) (83.8) (375.4) (351.6)…
Operating Income (Loss) Roll-up (in millions) Quarter to Date Year to Date 2011 2010 2011 2010 Electric Utilities 29.2 26.4 108.7 93.1 Gas Utilities 22.1 20.6 76.3 66.3 51.3 47.0 185.0 159.4 Non-regulated Energy Oil and gas…
Capital Structure Dec. 31, March 30, June 30, Sept. 30, Dec. 31, In millions 2010 2011 2011 2011 2011 Short term debt Current maturities 5.2 4.3 3.6 2.9 2.5 Notes payable 249.0 287.0 380.0 359.0 345.0 254.2 291.3 383.6 361.9 347.5…
Strategic Overview 15
Business Transformation Strategic accomplishments since 2007 provide more focus on core utilities, power generation and fuel production businesses Operating Income Assets 57% 28% 16% 57% 27% 34% 2% 1% 9% 2007 (4% 2011 2007…
Strategic Initiatives Timeline 2009 2010 2011 2012 anticipated Strategic Development Enserco portfolio Coal added to Power & Environ diversification portfolio added to portfolio Oil & Gas strategic Oil & Gas review complete…
Defined Investment Program Drives Earnings Growth Historical and Forecasted Capital Expenditures (in millions) 581 7 497 5 432 124 17 437 2 348 10 19 55 148 3 336 12 99 21 112 25 5 41 21 205 522 90 46 89 43 19 44 384…
Long-term Growth Opportunities Announced 2012-2015 Capital Expenditures Excludes routine capital expenditures for maintenance of assets (in Expected In- 2011 2012 2013 millions) Service Date Future Total Utility Colorado Electric 50%…
BHE Colorado Electric Regulatory Update New Rates Effective Jan. 1, 2012 Dates Revenue Return on Capital Rate Base Status Increase Equity Structure Requested 4/28/2011 40.2 million 11% 48% debt / 439 million Rate request to recover…
Colorado Generation Projects Completed 2012 Earnings Growth Driven By New Natural Gas-Fired Generation Projects That Started Serving Colorado Utility Customers on Jan. 1, 2012 Colorado Electrics 180 MW Generation Project completed on…
Colorado Electric - Wind Energy Project New Wind Project Helps Meet Renewable Energy Standards In Colorado Overview: Project consists of sixteen 1.8 MW turbines for total 29 MW; ready to serve Colorado Electrics utility customers in Q4…
Other Utility Regulatory Updates Joint Cheyenne Light and Black Hills Power Project Progresses On Nov. 1 Black Hills Power filed Integrated Resource Plan and Cheyenne Light amended Integrated Resource Plan previously filed on Aug.…
Impact of EPA Regulations Industrial & Commercial Boiler Regulations for Area Sources of Hazardous Air Pollutants (Boiler MACT Rules) Rules effective May 20, 2011 with compliance deadline of March 21, 2014 Anticipate retirement of…
Environmental Policy Impact Assessment RICE (Recipricating National Ambient Regional Haze Hazardous Air Rules (MACT) Internal Air Quality Clean Water Act Coal Ash Rule Greenhouse Gas Rules Standards Combustion Standards Engine)…
Oil and Gas - Mancos Shale Update 2011 Mancos Drilling Program: Well Test Information Current Daily Production 1/31/12 Lateral Initial Gas Conden- Frac Load Length Frac Rate Gas sate Water Basin/Well Feet Stages MMCFD MMCFD Bbls Bbls…
Oil & Gas - Mancos Shale Update Held By Production legacy assets San Juan Basin - 19,400 net acres (average royalty 20%) Approximately 120 potential wells on 160 acre spacing Piceance Basin - 54,700 net acres (average royalty…
2011 Scorecard Strategy 2011 Progress and Future Initiatives UTILITIES R File CPCN for another utility owned natural gas-fired turbine to replace retirement of coal + Acquire regulated utility properties in our geographic focus fired…
2012 Scorecard Strategy 2012 Progress and Future Initiatives UTILITIES Complete construction of Colorado Electric 29 MW wind project (Q4) + Acquire regulated utility properties in our geographic focus Complete CPCN process for third…
2011 Summary Focused on Serving Customers and Building Shareholder Value Strategy & Business Mix Refined Strong Execution on Major Projects in 2011 Over 300 Million of New Growth Projects Announced and Progressing Well…
Questions and Answers 31
Appendix 32
Guidance Reaffirmed Black Hills Corp. reaffirms the guidance for 2012 net income, as adjusted, from continuing operations to be in the range of 2.00 to 2.20 per share as previously issued on Jan. 18, 2012, based on the following…
Black Hills Corporation 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 company…
Electric and Natural Gas Utilities Regulated Electric and Natural Gas Utilities Serving over 762,000 customers MT MT SD SD WY Black Hills Power WY Cheyenne NE IA Light NE Nebraska Iowa Gas Gas CO CO KS KS Colorado…
Electric Utilities Q4 2011 Update Q4 Comparison of Net Income, as Adjusted Total MWh Sales Regulatory Update (in millions) (in millions) New COE rates implemented 1/1/12 for 180 Utility Customers MW power plant Off-system Sales…
Gas Utilities Q4 2011 Update Q4 Comparison of Net Income, as Adjusted Total Dth Sales Regulatory Update (in millions) (in millions) Kansas Gas evaluating need to file rate case 9.9 Colorado Gas granted extension until July 43.9…
Efficient Cost Recovery Electric Utility Cost Recovery Mechanisms * Jurisdiction Environmental DSM/ Energy Fuel Cost Trans- Purchased Fixed Cost Cost Efficiency mission Power Recovery BHP - South Dakota R R R R R BHP - Wyoming R R…
Oil and Gas and Energy Marketing Non-regulated Group Generates Electricity, Produces Natural Gas, Coal and Crude Oil, and Markets Energy and Related Products Oil and Gas Energy Marketing Operated wells in San Juan, Powder River,…
Oil and Gas Q4 2011Update Q4 Comparison of Net Income, as Adjusted Bcf Equivalent Sales (in millions) (1.2) 3.5 3.4 3.3 2.9 3.5 3.1 3.2 2.8 2.9 2.9 3.3 2.9 2.9 2.8 2.7 (3.0) Q2 2008 Q3…
Energy Marketing Operational Summary Realized and Unrealized Gross Margin Gross Margin by Strategy * (Total, Realized and Unrealized) (Combined Realized and Unrealized) Announcement on Jan. 18 of divesture to 50.0 17.5 50.0 close…
Energy Marketing Q4 2011Update Q4 Comparison of Net Income From Avg. Daily Natural Gas Volumes Avg. Daily Crude Oil Volumes (physical Bcf per day) (barrels per day) Discontinued Operations, Net of Tax (in millions) Prior Year Current…
Power Generation and Coal Mining Power Generation Coal Mining Ownership in three power generation facilities Includes approximately 262 million tons of low-sulfur Powder Wygen I - 69 MW of a 90 MW coal-fired facility in Gillette,…
Power Generation Q4 2011Update Q4 Comparison of Net Income, as Adjusted Generation Availability (%) Megawatts of Generation Capacity (in millions) Prior Year Current Year 100 97 0.9 0.9 100 100 99.7 100 99.7…
Coal Q4 2011Update Q4 Comparison of Net Income, as Adjusted Coal Production (in millions) (Coal in million tons Overburden in million cubic yards) Overburden Removed Coal Production 4.5 4.5 Prior Year Current Year…
Credit Facilities and Debt Primary Credit Facilities Capacity Utilized Available As of 12/31/2011 Corporate Revolver - Matures April 2013* 500 million 195 million 261 million 44 million (LC) Term Loan Due June 2012 -- 150 million --…
Credit Ratings Black Hills Corporation S&P Moodys Fitch Long-Term Issuer BBB- Baa3 BBB- Senior Unsecured BBB- Baa3 BBB- Outlook Stable Stable Stable Black Hills Power S&P Moodys Fitch Long-Term Issuer BBB- Baa2 BBB Senior…
Vision: Be the energy partner of choice. Mission: Improving life with energy. 48
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