|
Article Excerpt
OPERATOR: Ladies and gentleman, thank you for standing by and welcome to the NorthWestern Corporation's year end 2008 financial results. At this time, all lines are in listen-only mode. (Operator Instructions) As a reminder, today's call is being recorded. I would now like to turn the conference over to our host, Mr. Dan Rausch. Please go ahead, sir.
DAN RAUSCH, IR, NORTHWESTERN CORPORATION: Good afternoon and welcome to NorthWestern Corporation's December 31, 2008 year end financial results conference call and webcast. NorthWestern's results have been released and the release is available on our website at www.northwesternenergy.com. We also filed our 10-K pre-market open this morning. Joining us on the call are Bob Rowe, President and CEO, Brian Bird, Chief Financial Officer, Miggie Cramblit General Counsel and Kendall Kliewer, Controller.
This presentation contains forward-looking statements within meaning of the Safe Harbor provision of the Private Litigation Securities Act of 1995. These statements are based on upon our current expectations and speak only as of this date. Our actual results may differ materially and adversely from those expressed in our forward-looking statements, and as a result of various factors and uncertainties including those listed in our annual report on Form 10-K, recently forthcoming 10-Q's, recent form 8-K's and other filings with the SEC.
We undertake no obligation to revise or publicly update our forward-looking statements for any reason. Following this presentation, those joining us by teleconference will be able to ask questions. A replay of today's call will be made available beginning at 3:00 pm Eastern time today through March 13th, 2009. To access the replay, dial 800-475-6701, then access code 984444. That number again is 800-475-6701, and then code 984444. A replay of the webcast can be accessed from our website.
With that I will turn it over to President and CEO, Bob Rowe.
BOB ROWE, PRESIDENT AND CEO, NORTHWESTERN CORPORATION: Thank, Dan. As many of you, I've be the -- I've been with NorthWestern for about six months now. We've done a tremendous amount during that time. I'm going to start the call by saying that I'm deeply impressed by our employees at all levels of the Company. And particularly by their determination to provide real value for shareholders and for customers alike. We worked very hard to communicate this commitment to all of our stakeholders and then to live up to the it.
Thanks to hard work, discipline, and a long term perspective, NorthWest Energy ended 2008 with an increase in net income of 27% over the prior year. We also took significant steps toward our goal of being a fully regulated Company. In Montana, the Montana Public Service Commission approved adding to utility rate base our 30% interest in Colstrip Unit IV effective January 1st of this year. This is the beginning step in becoming a vertically integrated utility in Montana. We no longer have any significant unregulated assets. Again, this was an important milestone for the Company.
In South Dakota, of course, our electric business continues to be and always has been vertically integrated. We've worked very hard and earned an increase in our debt ratings and our stock performance, notably exceeded the utility indices. More specifically, our net income improved to $67.6 million for 2008 compared with $53.2 million in 2007. For the shareholders, this meant that the Board was able to improve increasing our quarterly dividend to $0.335 per share, and we also completed a share buyback program of approximately 3.1 million shares for approximately $78 million.
In addition, we settled the Montana electric and natural gas generate rate filing. That resulted in a $15 million increase in base rates, which was the first such increase to base rates in nearly eight years in Montana. In Montana, we filed for advanced approval with the PSC for constructing the 150 megawatt Mill Creek generating station, which is necessary to meet the Company's -- to meet our regulating needs. The hearing on our Mill Creek application is set for later this month. If approved, the plant could come on line by the end of 2010.
Just last month, the Montana Department of Environmental Quality, or DEQ issued the air quality permit for Mill Creek related to the MSTI project, our major transmission initiative. In June of 2008 we filed the Montana major facilities citing act application with the Montana DEQ, and that application was deemed complete in December 2008. This was, of course, a significant milestone in that project. So we're delighted with our operational progress and our increased earnings during 2008. We look forward to next year. We are increasing guidance for 2009 -- or we're initiating guidance for 2009 of $1.85 to $2 per fully diluted share.
And now it's my pleasure to turn the speaker over to our CFO, Brian Bird to discuss our 2008 financial results in more detail. Brian.
BRIAN BIRD, CFO, NORTHWESTERN CORPORATION: Thanks, Bob. As Bob mentioned, financially and otherwise, the Company had a good year in 2008.
Consolidated net income was $67.6 million, or $1.77 per diluted share, for 2008 compared with consolidated net income of $53.2 million, or $1.44 per diluted share for 2007. Operating income was $170.2 million compared with operating income of $140.1 million during 2007. The main drivers to our operating income and earnings increased during 2008 were as follows. First, gross margins increased by $30.4 million, primarily due to the combination of increased electric rates in Montana and increased gas rates in Montana, South Dakota, and Nebraska of approximately $20 million.
We also had 11.7% increase in volumes in...
|
