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Portland General Electric Announces First Quarter 2021 Results

Source: 
PR Newswire

PORTLAND, Ore., April 30, 2021 /PRNewswire/ -- Portland General Electric Company (NYSE: POR) today reported net income of $96 million, or $1.07 per diluted share, for the first quarter of 2021. This compares with net income of $81 million, or 91 cents per diluted share, for the first quarter of 2020.

"While the first quarter presented challenges, the team remains focused on supporting customers," said Maria Pope, PGE president and CEO. "I am proud of the way we came together to restore power quickly, and safely, during a once in 40-year ice event. These events demonstrate the importance of continued investment in a safe, reliable and resilient grid."

First Quarter 2021 Compared to First Quarter 2020

Total revenues increased as a result of  higher retail energy deliveries, driven by strong residential demand and growth in the high-tech and digital service sectors, as well as revenues from the recently completed Wheatridge Renewable Energy Facility. Purchased power and fuel expense increased due to lower hydro and wind production and higher than expected market prices. Operating expenses increased, primarily driven by higher storm restoration expense, legal fees and increased employee benefit expenses. Depreciation and amortization expense decreased, partially offset by utility capital additions. Tax expense decreased primarily due to a one-time recognition of a local tax flow-through adjustment.

Company Updates

Strong Energy Delivery Growth

Retail energy deliveries for the three months ended March 31, 2021 increased 1.2%, weather-adjusted, compared to the same period of 2020. This was driven by an increase of 8% in industrial deliveries, powered by the expansion in the high-tech and digital sectors, and 3% growth in residential deliveries as the average number of residential customers increased by 1.3%. These increases were partially offset by a decrease in commercial deliveries of 5%.

February 2021 Ice Storms and Damage

Beginning on February 11, 2021, an historic set of storms involving heavy snow, winds and ice impacted the United States, including PGE's service territory. Oregon Governor Kate Brown declared a state of emergency in response to these severe storms. Through March 31, 2021, PGE has incurred an estimated $87 million in incremental costs due to the storms, of which $33 million were capital and recorded to electric utility plant, net and $54 million were operating expenses associated with transmission and distribution. Beginning in 2019, the OPUC authorized the Company to collect $4 million annually from retail customers to cover incremental expenses related to major storm damages, and to defer any amount not utilized in the current year. In response to the February storms, PGE exhausted its storm collection balance for 2021 of $9 million, which was used to offset operating expenses. After accounting for storm deferral tracking mechanisms already in place, the cumulative incurred costs from the February storm damage are estimated to be $45 million as of March 31, 2021.

On February 15, 2021, PGE filed an application for authorization to defer emergency restoration costs for the February storms (Docket UM 2156). PGE expects to incur and defer additional costs subsequent to the storm.

The Climate Pledge

On April 21, 2021, PGE continued its commitment to advancing a sustainable future by joining The Climate Pledge,  aiming to be net-zero carbon by 2040 — a decade ahead of the Paris Agreement's goal of 2050. As a signatory to The Climate Pledge, led by Amazon and Global Optimism, PGE agrees to measure and report greenhouse gas emissions on a regular basis; implement decarbonization strategies in line with the Paris Agreement through real business changes and innovations, including efficiency improvements, renewable energy, materials reductions, and other carbon emission elimination strategies; and neutralize any remaining emissions with additional, quantifiable, real, permanent, and socially-beneficial offsets.

Quarterly Dividend

As previously announced, on April 28, 2021, the board of directors of Portland General Electric Company approved an increase in the annual dividend of 5.5%, or $0.09 per share, declaring a quarterly common stock dividend of $0.43 per share.

2021 Earnings Guidance

PGE is reaffirming its full-year 2021 earnings guidance of $2.55 to $2.70 per diluted share based on the following assumptions:

  • An increase in annual energy deliveries between 1% and 1.5%, weather adjusted, which reflects year over year:
    • Commercial growth, as economic recovery takes hold; and
    • Strong growth in industrial reflecting customer expansions.
    • These increases are partially offset by a decrease in residential as customers spend less time at home.
  • Normal temperatures in its utility service territory, for the remainder of the year;
  • Average hydro conditions for the remainder of year;
  • Wind generation based on five years of historical levels or forecast studies when historical data is not available;
  • Normal thermal plant operations, for the remainder of the year;
  • Revised capital expenditures of $700 million;
    • This represents a $45 million increase from prior guidance of $655 million, primarily due to capital expenditures related to the February storm;
  • Average construction work in progress balance of $340 million;
  • Revised operating and maintenance expense between $595 million and $615 million;
    • This represents a $20 million increase to original guidance of $575 million to $595 million, of which $12 million is associated with February storm response expense that is offset in revenue;
  • Depreciation and amortization expense between $410 million and $430 million;
  • Revised effective tax rate of 10% to 15%;
  • Cash from operations of $600 million to $650 million;
  • No new common equity to be issued for investment or operations; and
  • Continuation of existing regulatory mechanisms during 2021, including decoupling, the PCAM, the COVID-19 deferral, the wildfire deferral, and the new storm deferral.

First Quarter 2021 Earnings Call and Webcast — April 30, 2021

PGE will host a conference call with financial analysts and investors on Friday, April 30, 2021, at 11 a.m. ET. The conference call will be webcast live on the PGE website at investors.portlandgeneral.com. A replay of the call will be available beginning at 2 p.m. ET on Friday, April 30, 2021, through 2 p.m. ET on Friday, May 7, 2021.

Maria Pope, president and CEO; Jim Ajello, senior vice president of Finance, CFO, and treasurer; and Jardon Jaramillo, senior director, Investor Relations, Treasury, and Risk Management, will participate in the call. Management will respond to questions following formal comments.

The attached unaudited condensed consolidated statements of income and comprehensive income, condensed consolidated balance sheets and condensed consolidated statements of cash flows, as well as the supplemental operating statistics, are an integral part of this earnings release.

About Portland General Electric Company

Portland General Electric (NYSE: POR) is a fully integrated energy company based in Portland, Oregon, with operations across the state. The company serves approximately 900,000 customers with a service area population of 2 million Oregonians in 51 cities. PGE owns 16 generation plants across Oregon and other Northwestern states and maintains and operates 14 public parks and recreation areas. For over 130 years, PGE has delivered safe, affordable and reliable energy to Oregonians. Together with its customers, PGE has the No. 1 voluntary renewable energy program in the U.S. PGE and its 3,000 employees are working with customers to build a clean energy future. In 2020, PGE, employees, retirees and the PGE Foundation donated $5.6 million and volunteered 18,200 hours with more than 400 nonprofits across Oregon. For more information visit www.PortlandGeneral.com/news.

Safe Harbor Statement

Statements in this press release that relate to future plans, objectives, expectations, performance, events and the like may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements regarding the Company's full-year earnings guidance (including expectations regarding annual retail deliveries, average hydro conditions, wind generation, normal thermal plant operations, operating and maintenance expense and depreciation and amortization expense) as well as other statements containing words such as "anticipates," "believes," "intends," "estimates," "promises," "expects," "should," "conditioned upon," and similar expressions. Investors are cautioned that any such forward-looking statements are subject to risks and uncertainties, including, without limitation:  demand for electricity; the sale of excess energy during periods of low demand or low wholesale market prices; operational risks relating to the Company's generation facilities, including hydro conditions, wind conditions, disruption of fuel supply, and unscheduled plant outages, which may result in unanticipated operating, maintenance and repair costs, as well as replacement power costs; failure to complete capital projects on schedule or within budget, or the abandonment of capital projects, which could result in the Company's inability to recover project costs; the costs of compliance with environmental laws and regulations, including those that govern emissions from thermal power plants; changes in weather, hydroelectric and energy market conditions, which could affect the availability and cost of purchased power and fuel; the development of alternative technologies; changes in capital and credit market conditions, which could affect the access to and availability of cost of capital and result in delay or cancellation of capital projects or execution of the Company's strategic plan as currently envisioned; the outcome of various legal and regulatory actions; general economic and financial market conditions; severe weather conditions, wildfires, and other natural phenomena and natural disasters that could result in operational disruptions, unanticipated restoration costs, or liability for third party property damage; cyber security breaches of the Company's customer information system or operating systems, data security breaches, or acts of terrorism, which could disrupt operations, require significant expenditures, or result in claims against the Company; PGE business activities are concentrated in one region and future performance may be affected by events and factors unique to Oregon; the impact of the recommendations on the Company and its operations based on the review conducted by the Special Committee of the Board of Directors relating to energy trading losses, the time and expense incurred in implementing the recommendations of the Special Committee, and any reputational damage to the Company relating to the matters underlying the Special Committee's review; and widespread health emergencies or outbreaks of infectious diseases such as the novel coronavirus disease (COVID-19), which may affect our financial position, results of operations and cash flows. As a result, actual results may differ materially from those projected in the forward-looking statements.

POR

Source: Portland General Company

 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

AND COMPREHENSIVE INCOME

(Dollars in millions, except per share amounts)

(Unaudited)


 

 

Three Months Ended March 31,


 

2021


 

2020

Revenues:


 

 

 

Revenues, net

$

612


 

 

$

564


 

Alternative revenue programs, net of amortization

(3)


 

 

9


 

Total revenues

609


 

 

573


 

Operating expenses:


 

 

 

Purchased power and fuel

169


 

 

153


 

Generation, transmission and distribution

80


 

 

73


 

Administrative and other

86


 

 

71


 

Depreciation and amortization

103


 

 

108


 

Taxes other than income taxes

38


 

 

35


 

Total operating expenses

476


 

 

440


 

Income from operations

133


 

 

133


 

Interest expense, net

34


 

 

33


 

Other income (expense):


 

 

 

Allowance for equity funds used during construction

4


 

 

3


 

Miscellaneous income (expense), net

2


 

 

(4)


 

Other income (expense), net

6


 

 

(1)


 

Income before income tax expense

105


 

 

99


 

Income tax expense

9


 

 

18


 

Net income

96


 

 

81


 

Other comprehensive income


 

 

1


 

Comprehensive income

$

96


 

 

$

82


 

 

 

 

 

Weighted-average common shares outstanding (in thousands):


 

 

 

Basic

89,556


 

 

89,429


 

Diluted

89,703


 

 

89,579


 

 

 

 

 

Earnings per share:


 

 

 

Basic

$

1.07


 

 

$

0.91


 

Diluted

$

1.07


 

 

$

0.91


 

 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in millions)

(Unaudited)


 

 

March 31, 2021


 

December 31,

2020

ASSETS


 

 

 

Current assets:


 

 

 

Cash and cash equivalents

$

135


 

 

$

257


 

Accounts receivable, net

268


 

 

271


 

Inventories

67


 

 

72


 

Regulatory assets—current

25


 

 

23


 

Other current assets

127


 

 

98


 

Total current assets

622


 

 

721


 

Electric utility plant, net

7,616


 

 

7,539


 

Regulatory assets—noncurrent

591


 

 

569


 

Nuclear decommissioning trust

44


 

 

45


 

Non-qualified benefit plan trust

43


 

 

42


 

Other noncurrent assets

153


 

 

153


 

Total assets

$

9,069


 

 

$

9,069


 

 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS, continued

(Dollars in millions)

(Unaudited)


 

 

March 31, 2021


 

December 31,

2020

LIABILITIES AND SHAREHOLDERS' EQUITY


 

 

 

Current liabilities:


 

 

 

Accounts payable

$

199


 

 

$

153


 

Liabilities from price risk management activities—current

20


 

 

14


 

Short-term debt

200


 

 

150


 

Current portion of long-term debt

20


 

 

160


 

Current portion of finance lease obligation

16


 

 

16


 

Accrued expenses and other current liabilities

319


 

 

322


 

Total current liabilities

774


 

 

815


 

Long-term debt, net of current portion

2,886


 

 

2,886


 

Regulatory liabilities—noncurrent

1,353


 

 

1,369


 

Deferred income taxes

391


 

 

374


 

Unfunded status of pension and postretirement plans

299


 

 

299


 

Liabilities from price risk management activities—noncurrent

118


 

 

136


 

Asset retirement obligations

270


 

 

270


 

Non-qualified benefit plan liabilities

101


 

 

101


 

Finance lease obligations, net of current portion

128


 

 

129


 

Other noncurrent liabilities

74


 

 

77


 

Total liabilities

6,394


 

 

6,456


 

Shareholders' Equity:


 

 

 

Preferred stock, no par value, 30,000,000 shares authorized; none issued and

outstanding as of March 31, 2021 and December 31, 2020


 

 


 

Common stock, no par value, 160,000,000 shares authorized; 89,576,748 and

89,537,331 shares issued and outstanding as of March 31, 2021 and December

31, 2020, respectively

1,233


 

 

1,231


 

Accumulated other comprehensive loss

(11)


 

 

(11)


 

Retained earnings

1,453


 

 

1,393


 

Total shareholders' equity

2,675


 

 

2,613


 

Total liabilities and shareholders' equity

$

9,069


 

 

$

9,069


 

 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)


 

 

Three Months Ended March 31,


 

2021


 

2020

Cash flows from operating activities:


 

 

 

Net income

$

96


 

 

$

81


 

Adjustments to reconcile net income to net cash provided by operating

activities:


 

 

 

Depreciation and amortization

103


 

 

108


 

Deferred income taxes

(1)


 

 

7


 

Pension and other postretirement benefits

6


 

 

6


 

Allowance for equity funds used during construction

(4)


 

 

(3)


 

Decoupling mechanism deferrals, net of amortization

3


 

 

(9)


 

Amortization of net benefits due to Tax Reform


 

 

(6)


 

Deferral of incremental storm costs

(41)


 

 


 

Other non-cash income and expenses, net

13


 

 

19


 

Changes in working capital:


 

 

 

(Increase)/decrease in accounts receivable, net

(2)


 

 

19


 

Decrease/(increase) in inventories

4


 

 

(1)


 

(Increase)/decrease in margin deposits

(1)


 

 

(19)


 

Increase/(decrease) in accounts payable and accrued liabilities

26


 

 

(22)


 

Other working capital items, net

(14)


 

 

(9)


 

Other, net

(20)


 

 

(16)


 

Net cash provided by operating activities

168


 

 

155


 

 

 

 

 

Cash flows from investing activities:


 

 

 

Capital expenditures

(153)


 

 

(162)


 

Sales of Nuclear decommissioning trust securities

3


 

 

3


 

Purchases of Nuclear decommissioning trust securities

(3)


 

 

(2)


 

Other, net

(9)


 

 

4


 

Net cash used in investing activities

(162)


 

 

(157)


 

 

 

 

 

Cash flows from financing activities:


 

 

 

Proceeds from issuance of long-term debt


 

 

119


 

Payments on long-term debt

(140)


 

 

(98)


 

Borrowings on short-term debt

200


 

 

20


 

Repayments of short-term debt

(150)


 

 

(20)


 

Issuance of commercial paper, net


 

 

20


 

Dividends paid

(36)


 

 

(34)


 

Other

(2)


 

 

(5)


 

Net cash provided by (used in) financing activities

(128)


 

 

2


 

Increase (Decrease) in cash and cash equivalents

(122)


 

 


 

Cash and cash equivalents, beginning of period

257


 

 

30


 

Cash and cash equivalents, end of period

$

135


 

 

$

30


 

 

 

 

 

Supplemental cash flow information is as follows:


 

 

 

Cash paid for interest, net of amounts capitalized

$

16


 

 

$

12


 

 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

SUPPLEMENTAL OPERATING STATISTICS

(Unaudited)


 

 

Three Months Ended March 31,


 

2021


 

2020

Revenues (dollars in millions):


 

 

 

 

 

 

 

Retail:


 

 

 

 

 

 

 

Residential

$

310


 

 

51

%


 

$

279


 

 

48

%

Commercial

162


 

 

26


 

 

159


 

 

28


 

Industrial

60


 

 

10


 

 

51


 

 

9


 

Direct Access

11


 

 

2


 

 

11


 

 

2


 

Subtotal

543


 

 

89


 

 

500


 

 

87


 

Alternative revenue programs, net of amortization

(3)


 

 


 

 

9


 

 

2


 

Other accrued revenues, net

13


 

 

2


 

 

5


 

 

1


 

Total retail revenues

553


 

 

91


 

 

514


 

 

90


 

Wholesale revenues

33


 

 

5


 

 

47


 

 

8


 

Other operating revenues

23


 

 

4


 

 

12


 

 

2


 

Total revenues

$

609


 

 

100

%


 

$

573


 

 

100

%


 

 

 

 

 

 

 

 

Energy deliveries (MWhs in thousands):


 

 

 

 

 

 

 

Retail:


 

 

 

 

 

 

 

Residential

2,239


 

 

35

%


 

2,131


 

 

31

%

Commercial

1,564


 

 

24


 

 

1,626


 

 

24


 

Industrial

897


 

 

14


 

 

810


 

 

12


 

Subtotal

4,700


 

 

73


 

 

4,567


 

 

67


 

Direct access:


 

 

 

 

 

 

 

Commercial

150


 

 

2


 

 

170


 

 

3


 

Industrial

359


 

 

6


 

 

355


 

 

5


 

Subtotal

509


 

 

8


 

 

525


 

 

8


 

Total retail energy deliveries

5,209


 

 

81


 

 

5,092


 

 

75


 

Wholesale energy deliveries

1,245


 

 

19


 

 

1,693


 

 

25


 

Total energy deliveries

6,454


 

 

100

%


 

6,785


 

 

100

%


 

 

 

 

 

 

 

 

Average number of retail customers:


 

 

 

 

 

 

 

Residential

797,602


 

 

88

%


 

787,095


 

88

%

Commercial

110,703


 

 

12


 

 

110,073


 

12


 

Industrial

193


 

 


 

 

194


 


 

Direct access

601


 

 


 

 

627


 


 

Total

909,099


 

 

100

%


 

897,989


 

 

100

%

 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

SUPPLEMENTAL OPERATING STATISTICS, continued

(Unaudited)


 

 

Three Months Ended March 31,


 

2021


 

2020

Sources of energy (MWhs in thousands):


 

 

 

 

 

 

 

Generation:


 

 

 

 

 

 

 

Thermal:


 

 

 

 

 

 

 

Natural gas

2,383


 

 

38

%


 

2,433


 

 

37

%

Coal

582


 

 

9


 

 

1,186


 

 

18


 

Total thermal

2,965


 

 

47


 

 

3,619


 

 

55


 

Hydro

317


 

 

5


 

 

369


 

 

6


 

Wind

532


 

 

9


 

 

585


 

 

9


 

Total generation

3,814


 

 

61


 

 

4,573


 

 

70


 

Purchased power:


 

 

 

 

 

 

 

Term

1,844


 

 

30


 

 

1,604


 

 

24


 

Hydro

340


 

 

5


 

 

345


 

 

5


 

Wind

239


 

 

4


 

 

64


 

 

1


 

Total purchased power

2,423


 

 

39


 

 

2,013


 

 

30


 

Total system load

6,237


 

 

100

%


 

6,586


 

 

100

%

Less: wholesale sales

(1,245)


 

 

 

 

(1,693)


 

 

 

Retail load requirement

4,992


 

 

 

 

4,893


 

 

 

 

The following table indicates the number of heating and cooling degree-days for the three months ended March 31, 2021 and 2020, along with 15-year averages based on weather data provided by the National Weather Service, as measured at Portland International Airport: 


 

Heating Degree-days


 

2021


 

2020


 

Avg.

January

620


 

 

588


 

 

719


 

February

641


 

 

605


 

 

598


 

March

544


 

 

568


 

 

530


 

Year-to-date

1,805


 

 

1,761


 

 

1,847


 

Decrease from the 15-year average

(2.3)

%


 

(4.7)

%


 

 

 

Media Contact:


 

Investor Contact:


 

Brianne Hyder


 

Jardon Jaramillo


 

Corporate Communications


 

Investor Relations


 

Phone: 503-464-8596


 

Phone: 503-464-7051

Cision View original content:http://www.prnewswire.com/news-releases/portland-general-electric-announces-first-quarter-2021-results-301280858.html

SOURCE Portland General Company

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