NorthWestern Reports 2020 Financial Results
NorthWestern Corporation (NWE) reported a GAAP diluted EPS of $3.06 for 2020, down from $3.98 in 2019, with a net income of $155.2 million, a decrease of $46.9 million. The decline is attributed to a prior period tax benefit and lower gross margins due to warmer weather and the COVID-19 pandemic. Despite this, the company announced a 3.3% increase in its quarterly dividend to $0.62, payable March 31, 2021. NWE maintains its 2021 earnings guidance of $3.30-$3.45 per share, projecting significant capital investments in generation projects and efficiency improvements.
- Declaring a quarterly dividend increase of 3.3% to $0.62 per share.
- Non-GAAP Adjusted diluted EPS for 2020 was $3.35, within the guidance range.
- Ongoing capital investment projects exceeding $200 million planned for 2021.
- Net income decreased by $46.9 million year-over-year.
- Lower gross margin of $892.5 million in 2020 compared to $939.9 million in 2019.
- Operating income declined to $236.2 million from $276.9 million in 2019.
Company reports GAAP diluted earnings per share of
BUTTE, Mont. and SIOUX FALLS, S.D., Feb. 11, 2021 (GLOBE NEWSWIRE) -- NorthWestern Corporation d/b/a NorthWestern Energy (Nasdaq: NWE) reported financial results for the year ended December 31, 2020. Net income for the period was
Non-GAAP Adjusted diluted earnings per share for the period were
“2020 provided a unique set of challenges for most every person and organization. As a provider of essential energy services, NorthWestern quickly recognized the need to pivot to a new model for our workforce – one that ensured the safety of our employees, customers and communities. While most of us look forward to the day that terms like “social distancing” and “remote workforce” become a distant memory, we will look for ways to retain the best of what we learned through the process - like protocols that helped us achieve our best-ever safety record while also completing more maintenance and capital work than any year in our history or new efficiencies that reduced operating costs and helped mitigate gross margin reductions we experienced from our largest commercial and industrial customers’ pandemic related slowdown or closures,” said Bob Rowe, President and Chief Executive Officer.
“2021 is likely to present its own challenges with another record year planned of capital investment, including several generation projects and smaller hydro-electric upgrades that will start to address our critical capacity shortfall in both Montana and South Dakota. We are reviewing the analyses we recently received from the independent party administering our competitive solicitation. We anticipate that at least one of our projects, resulting in owned capacity generation investment in excess of
Additional information regarding this release can be found in the earnings presentation found at www.northwesternenergy.com/our-company/investor-relations/presentations-and-webcasts.
| Year Ended December 31, | |||||||
| (in thousands, except per share amounts) | 2020 | 2019 | |||||
| Revenues | $ | 1,198,670 | $ | 1,257,910 | |||
| Cost of sales | 306,190 | 318,020 | |||||
| Gross Margin (1) | 892,480 | 939,890 | |||||
| Operating, general and administrative expense | 297,115 | 318,229 | |||||
| Property and other taxes | 179,517 | 171,888 | |||||
| Depreciation and depletion | 179,644 | 172,923 | |||||
| Total Operating Expenses | 656,276 | 663,040 | |||||
| Operating income | 236,204 | 276,850 | |||||
| Interest expense, net | (96,812 | ) | (95,068 | ) | |||
| Other income, net | 4,853 | 413 | |||||
| Income before income taxes | 144,245 | 182,195 | |||||
| Income tax benefit | 10,970 | 19,925 | |||||
| Net Income | 155,215 | 202,120 | |||||
| Basic Shares Outstanding | 50,559 | 50,429 | |||||
| Earnings per Share - Basic | $ | 3.07 | $ | 4.01 | |||
| Diluted Shares Outstanding | 50,704 | 50,752 | |||||
| Earnings per Share - Diluted | $ | 3.06 | $ | 3.98 | |||
| Dividends Declared per Common Share | $ | 2.40 | $ | 2.30 | |||
| (1) Gross Margin, defined as Revenues less Cost of Sales, is a non-GAAP financial measure. See "Non-GAAP Financial Measures" section below for more information. | |||||||
Significant Trends and Regulation
COVID-19 Pandemic
We are one of many companies providing essential services during the national emergency related to the COVID-19 pandemic. Our level of service to our 743,000 customers remains uninterrupted. We implemented a comprehensive set of actions to help our customers, communities, and employees, while maintaining our commitments to provide reliable service and to continue to monitor and adapt our financial business plan for the evolving COVID-19 pandemic challenges. In March, we voluntarily informed both our retail customers and state regulators that disconnections for non-payment would be temporarily suspended, and we have provided an incremental
2020 Impact - The COVID-19 pandemic has impacted our financial results with a reduction in our commercial and industrial sales volumes, offset in part by an increase in usage by residential customers. We also experienced an increase in certain operating expenses including an increase in uncollectible accounts and interest expense offset in part by lower operating expenses as detailed below. COVID-19 continues to be an evolving situation and we expect to continue to experience impacts to our financial results in 2021.
| Estimate of COVID-19 Impacts | ||||||||
| Year Ended December 31, 2020 | ||||||||
| Low | High | |||||||
| (in millions) | ||||||||
| Gross Margin (1) | $ | (8.0 | ) | $ | (11.0 | ) | ||
| Operating Expenses | ||||||||
| Medical, labor and travel & training | (5.5 | ) | (5.5 | ) | ||||
| Uncollectible Accounts | 3.0 | 3.0 | ||||||
| Total Operating Expense | (2.5 | ) | (2.5 | ) | ||||
| Operating Loss | (5.5 | ) | (8.5 | ) | ||||
| Interest expense | (0.7 | ) | (0.7 | ) | ||||
| Pretax Loss | (6.2 | ) | (9.2 | ) | ||||
| Income tax benefit | 1.6 | 2.3 | ||||||
| Net Loss(2) | (4.6 | ) | (6.9 | ) | ||||
| (1) Non-GAAP financial measure. See "Non-GAAP Financial Measure" above. | ||||||||
| (2) Income tax benefit calculated using a | ||||||||
We submitted accounting order requests in Montana and South Dakota to allow for the deferral of uncollectible accounts expense in excess of amounts currently recovered from customers and to determine ratemaking treatment in a future proceeding.
- The South Dakota Public Utilities Commission issued an order in August 2020, authorizing deferral of costs for possible recovery through future rates. As of December 31, 2020 we have deferred
$0.2 million of uncollectible accounts expense into a regulatory asset in South Dakota.
- The Montana Public Service Commission (MPSC) issued an order in November 2020, declining to authorize establishment of a regulatory asset for the deferral of the incremental bad debt expense.
We are working with customers who have been unable to pay during the COVID-19 pandemic, including offering extended payment arrangements. In each of our jurisdictions, we resumed disconnection procedures for non-payment during the third quarter of 2020, supporting our efforts to reduce past due customer balances. We are subject to certain annual winter disconnection procedures, which went into effect on November 1st and will remain in effect through March 31st.
The continued progression of and global response to the COVID-19 pandemic increases the risk of delays in construction activities and equipment deliveries related to our capital projects, including potential delays in obtaining permits from government agencies, resulting in a potential deferral of capital expenditures. While we have not experienced significant supply chain challenges to date and were able to execute on over
The ongoing impacts of the COVID-19 pandemic remain uncertain. Continued slowdown in the United States’ economic growth, demand for commodities and/or material changes in governmental policy may continue to result in lower economic growth with lower demand for electricity and natural gas, as well as negatively affect the ability of various customers, contractors, suppliers and other business partners to fulfill their obligations. These impacts could have a material adverse effect on our results of operations, financial condition and prospects.
2021 Impact - We expect to continue to experience a reduction in our commercial and industrial sales volumes, offset in part by an increase in usage by residential customers through the second quarter of 2021.
Electric Resource Planning - Montana
We are currently 630 MW short of our peak needs and we cover the shortfall through market purchases. Absent additional supply resources, we forecast that our portfolio will be 725 MW short by 2025, considering expiring contracts and a modest increase in customer demand. We issued an all-source competitive solicitation, or request for proposals (RFP), in February 2020 for up to 280 MWs of peaking and flexible capacity to be available for commercial operation in early 2023. Further, we expect additional all-source competitive solicitation requests will be forthcoming, beginning in late 2021 or 2022.
Initial bids for the February 2020 RFP were received in July 2020. Bid submissions were evaluated by an independent party. We are reviewing analyses from the independent administrator and expect to announce the selection of multiple projects during the first quarter of 2021. Bids were submitted on our behalf for generating facilities providing long-duration flexible capacity in excess of 200 MWs. We anticipate that at least one of our projects will be among those selected resulting in owned capacity generation investment in excess of
Financing
We anticipate financing our ongoing maintenance and capital programs with a combination of cash flows from operations, first mortgage bonds and equity issuances. We anticipate initiating a 3-year
Significant Earnings Drivers
Revenue
Consolidated operating revenues in 2020 were
Gross Margin
Consolidated gross margin for the twelve months ended December 31, 2020 was
Consolidated gross margin for items impacting net income decreased
$11.0 million lower resulting from a decrease in electric retail volumes due to warmer winter weather in Montana and South Dakota and lower industrial demand unrelated to the COVID-19 pandemic, partly offset by customer growth and warmer summer weather. In addition, impacts of the COVID-19 pandemic drove a decline of approximately$7 -$9 million , as a result of lower commercial and industrial demand, partly offset by higher residential usage;$10.6 million lower resulting from a decrease in gas volumes due to warmer winter weather, offset in part by customer growth. In addition, impacts of the COVID-19 pandemic drove a decline of approximately of$1 -$2 million , as a result of lower customer usage;$9.4 million lower due to a MPSC disallowance of$5.6 million of replacement power costs incurred during a 2018 intermittent outage at our Colstrip coal-fired generating facility and$3.8 million of costs related to the prorated application of a change in state law that eliminated the deadband and QF cost sharing component of our Power Cost and Credit Adjustment Mechanism.$3.3 million lower due to a less favorable adjustment of our electric Qualifying Facilities, or QF, liability (unrecoverable costs associated with Public Utility Regulatory Policies Act contracts as a part of a 2002 stipulation with the MPSC and other parties) as compared with the same period in 2019 due to the combination of:- A net
$1.1 million lower favorable adjustment due to actual price escalation, which was less than estimated ($2.2 million in the current period compared with$3.3 million in the prior period); and - Higher costs of approximately
$2.2 million , due to a$0.9 million reduction in costs for the adjustment to actual output and pricing for the current contract year as compared with a$3.1 million reduction in costs in the prior period.
- A net
$2.7 million lower due to the inclusion in the prior period of lower Montana electric supply costs as a result of changes in the associated statute, offset in part by lower supply costs in 2020;$2.7 million lower resulting from lower demand to transmit energy across our transmission lines due to market conditions and pricing, including the closure of Colstrip Units 1 and 2;$1.2 million lower due to a reduction of rates due to the step down of our Montana gas production assets; and$9.2 million lower other miscellaneous gross margin items.
These decreases were slightly offset by a
Consolidated gross margin for items that had no impact on net income increased
$6.3 million increase in revenue for property taxes recovered in trackers, offset by increased property tax expense;$5.0 million decrease in revenue due to the increase in production tax credit benefits passed through to customers in our tracker mechanisms, which are offset by decreased income tax expense; and$0.1 million decrease in revenue for operating costs included in trackers, offset by a decrease in associated operating expense.$0.1 million decrease in revenues for gas production taxes recovered in revenue, offset by a decrease in property and other taxes.
Operating, General and Administrative Expenses
Consolidated operating, general and administrative expenses for the twelve months ended December 31, 2020 were
Consolidated operating, general and administrative expenses for items impacting net income decreased
$10.1 million lower employee benefit costs primarily due to a decrease in employee incentive compensation expense and a slight decrease in medical costs due to the COVID-19 pandemic;$4.1 million decreased labor costs including approximately$1.3 million of in-home customer work limited due to the COVID-19 pandemic and more time being spent by employees on capital projects than maintenance projects (which are expensed);$3.2 million lower hazard tree line clearance costs. Costs in 2020 reflect a more normal level, which is lower than 2019. We expect to continue the program over the next several years with anticipated 2021 costs ranging from approximately$3 million to$4 million ;$3.0 million reduction in employee travel and training costs due to the impacts of the COVID-19 pandemic;$1.2 million lower environmental costs, primarily at our manufactured gas plant sites;$0.9 million lower maintenance at our electric generation facilities; and$3.2 million lower other miscellaneous expenses.
These reductions were partly offset by a
The change in consolidated operating, general and administrative expenses for items that had no impact on net income increased
$7.0 million increase due to the regulatory treatment of the non-service cost components of pension and postretirement benefit expense, which is offset in other income;$0.1 million lower operating expenses included in trackers recovered through revenue; and$5.3 million decrease due to the change in the value of non-employee directors deferred compensation resulting from changes in our stock price, which is offset in other income.
Property and Other Taxes
Property and other taxes were
Depreciation and Depletion Expense
Depreciation and depletion expense was
Operating Income
Consolidated operating income in 2020 was
Interest Expense
Consolidated interest expense in 2020 was
Other Income
Consolidated other income was
Income Tax
Consolidated income tax benefit in 2020 was
The following table summarizes the differences between our effective tax rate and the federal statutory rate for the periods:
| (in millions) | Year Ended December 31, | |||||||||||||
| 2020 | 2019 | |||||||||||||
| Income Before Income Taxes | $ | 144.2 | $ | 182.2 | ||||||||||
| Income tax calculated at federal statutory rate | 30.3 | 21.0 | % | 38.3 | 21.0 | % | ||||||||
| Permanent or flow through adjustments: | ||||||||||||||
| State income, net of federal provisions | (1.5 | ) | (1.1 | ) | % | 1.3 | 0.7 | % | ||||||
| Recognition of unrecognized tax benefit | — | — | % | (22.8 | ) | (12.5 | ) | % | ||||||
| Flow-through repairs deductions | (23.8 | ) | (16.5 | ) | % | (19.7 | ) | (10.8 | ) | % | ||||
| Production Tax Credits | (13.1 | ) | (9.1 | ) | % | (11.5 | ) | (6.3 | ) | % | ||||
| Plant and depreciation of flow through items | 0.1 | 0.1 | % | (4.0 | ) | (2.2 | ) | % | ||||||
| Amortization of excess deferred income taxes (DIT) | (1.0 | ) | (0.7 | ) | % | (1.7 | ) | (0.9 | ) | % | ||||
| Impact of Tax Cuts and Jobs Act | — | — | % | (0.2 | ) | (0.1 | ) | % | ||||||
| Prior year permanent return to accrual adjustments | (1.7 | ) | (1.2 | ) | % | 0.6 | 0.3 | % | ||||||
| Other, net | (0.3 | ) | (0.1 | ) | % | (0.1 | ) | (0.1 | ) | % | ||||
| Subtotal | (41.3 | ) | (28.6 | ) | % | (58.2 | ) | (31.9 | ) | % | ||||
| Income Tax (Benefit) Expense | $ | (11.0 | ) | (7.6 | ) | % | $ | (19.9 | ) | (10.9 | ) | % | ||
Net Income
Consolidated net income for the twelve months ended December 31, 2020 was
Reconciliation of Primary Changes from 2019 to 2020
| Year Ended December 31, | ||||||||||
| ($millions, except EPS) | Pretax Income | Net Income (1) | Diluted EPS | |||||||
| 2019 reported | $ | 182.2 | $ | 202.1 | $ | 3.98 | ||||
| Gross Margin | ||||||||||
| Electric retail volumes and demand | (11.0 | ) | (8.2 | ) | (0.16 | ) | ||||
| Natural gas retail volumes | (10.6 | ) | (7.9 | ) | (0.16 | ) | ||||
| Disallowance of prior period supply costs | (9.4 | ) | (7.0 | ) | (0.14 | ) | ||||
| Lower electric QF liability adjustment | (3.3 | ) | (2.5 | ) | (0.05 | ) | ||||
| Montana electric supply cost recovery | (2.7 | ) | (2.0 | ) | (0.04 | ) | ||||
| Electric transmission | (2.7 | ) | (2.0 | ) | (0.04 | ) | ||||
| Montana natural gas production rates | (1.2 | ) | (0.9 | ) | (0.02 | ) | ||||
| Montana electric retail rates | 1.6 | 1.2 | 0.02 | |||||||
| Other | (9.2 | ) | (6.9 | ) | (0.13 | ) | ||||
| Subtotal: Items impacting net income | (48.5 | ) | (36.2 | ) | (0.72 | ) | ||||
| Property taxes recovered in revenue, offset in prop. tax expense | 6.3 | 4.7 | 0.09 | |||||||
| Production tax credits reducing revenue, offset in income tax expense | (5.0 | ) | (3.7 | ) | (0.07 | ) | ||||
| Operating expense recovered in revenue, offset in operating expense | (0.1 | ) | (0.1 | ) | — | |||||
| Gas production taxes recovered in revenue, offset in property and other taxes | (0.1 | ) | (0.1 | ) | — | |||||
| Subtotal: Items not impacting net income | 1.1 | 0.8 | 0.02 | |||||||
| Total Gross Margin | (47.4 | ) | (35.4 | ) | (0.70 | ) | ||||
| OG&A Expense | ||||||||||
| Employee benefits | 10.1 | 7.5 | 0.15 | |||||||
| Labor | 4.1 | 3.1 | 0.06 | |||||||
| Hazard trees | 3.2 | 2.4 | 0.05 | |||||||
| Travel and training | 3.0 | 2.2 | 0.04 | |||||||
| Environmental costs | 1.2 | 0.9 | 0.02 | |||||||
| Generation maintenance | 0.9 | 0.7 | 0.01 | |||||||
| Uncollectible accounts | (3.0 | ) | (2.2 | ) | (0.04 | ) | ||||
| Other | 3.2 | 2.4 | 0.05 | |||||||
| Subtotal: Items impacting net income | 22.7 | 17.0 | 0.34 | |||||||
| Pension and other postretirement benefits, offset in other income | (7.0 | ) | (5.2 | ) | (0.10 | ) | ||||
| Operating expenses recovered in trackers, offset in revenue | 0.1 | 0.1 | — | |||||||
| Non-employee directors deferred compensation, offset in other income | 5.3 | 4.0 | 0.08 | |||||||
| Subtotal: Items not impacting net income | (1.6 | ) | (1.1 | ) | (0.02 | ) | ||||
| Total OG&A Expense | 21.1 | 15.9 | 0.32 | |||||||
| Other items | ||||||||||
| Depreciation and depletion expense | (6.7 | ) | (5.0 | ) | (0.10 | ) | ||||
| Property and other taxes | (7.6 | ) | (5.7 | ) | (0.11 | ) | ||||
| Interest expense | (1.8 | ) | (1.3 | ) | (0.03 | ) | ||||
| Other income (includes pension / comp. offset above) | 4.4 | 3.3 | 0.07 | |||||||
| Permanent and flow-through adjustments to income tax | — | (18.6 | ) | (0.37 | ) | |||||
| Total Other items | (11.7 | ) | (27.3 | ) | (0.54 | ) | ||||
| Total impact of above items | (38.0 | ) | (46.9 | ) | (0.92 | ) | ||||
| 2020 reported | $ | 144.2 | $ | 155.2 | $ | 3.06 | ||||
| (1) Income Tax Benefit (Expense) calculation on reconciling items assumes blended federal plus state effective tax rate of | ||||||||||
Liquidity and Capital Resources
As of December 31, 2020, our total net liquidity was approximately
Dividend Declared
NorthWestern's Board of Directors declared a quarterly common dividend of
Significant Items Not Contemplated in Guidance
A reconciliation of items not factored into our adjusted non-GAAP diluted earnings per share of
| (in millions, except EPS) | ||||||||||||||||||||||||||
| Actual | ||||||||||||||||||||||||||
| Nine Months Ended September 30, 2020 | Q4 2020 | Full Year 2020 | ||||||||||||||||||||||||
| Pre-tax Income | Net(1) Income | Diluted EPS | Pre-tax Income | Net(1) Income | Diluted EPS | Pre-tax Income | Net(1) Income | Diluted EPS(2) | ||||||||||||||||||
| 2020 Reported GAAP | $96.4 | $101.6 | $2.01 | $47.8 | $53.6 | $1.06 | $144.2 | $155.2 | $3.06 | |||||||||||||||||
| Non-GAAP Adjustments: | ||||||||||||||||||||||||||
| Remove impact of unfavorable weather | 4.1 | 3.1 | 0.06 | 5.7 | 4.3 | 0.08 | 9.8 | 7.3 | 0.14 | |||||||||||||||||
| Disallowance of prior period supply costs | — | — | — | 9.9 | 7.4 | 0.15 | 9.9 | 7.4 | 0.15 | |||||||||||||||||
| 2020 Adj. Non-GAAP | ||||||||||||||||||||||||||
| Actual | ||||||||||||||||||||||||||
| Nine Months Ended September 30, 2019 | Q4 2019 | Full Year 2019 | ||||||||||||||||||||||||
| Pre-tax Income | Net(1) Income | Diluted EPS | Pre-tax Income | Net(1) Income | Diluted EPS | Pre-tax Income | Net(1) Income | Diluted EPS(2) | ||||||||||||||||||
| 2019 Reported GAAP | $122.0 | $142.1 | $2.80 | $60.1 | $60.0 | $1.18 | $182.2 | $202.1 | $3.98 | |||||||||||||||||
| Non-GAAP Adjustments: | ||||||||||||||||||||||||||
| Remove impact of (favorable) unfavorable weather | (8.0 | ) | (6.0 | ) | (0.12 | ) | 0.7 | 0.5 | 0.01 | (7.3 | ) | (5.5 | ) | (0.11 | ) | |||||||||||
| Remove impact of unrecognized income tax benefit | — | (22.8 | ) | (0.45 | ) | — | — | — | — | (22.8 | ) | (0.45 | ) | |||||||||||||
| 2019 Adj. Non-GAAP | ||||||||||||||||||||||||||
| (1) Income Tax Benefit (Expense) calculation on reconciling items assumes blended federal plus state effective tax rate of | ||||||||||||||||||||||||||
| (2) Due to changes in the quarterly diluted share count, full year EPS may be +/- | ||||||||||||||||||||||||||
2021 Earnings Guidance Affirmed
NorthWestern affirms its 2021 earnings guidance range of
- Normal weather in our electric and natural gas service territories;
- Continued Covid-19 related reduction in our commercial and industrial sales volumes, offset in part by an increase in usage by residential customers through the second quarter of 2021;
- A consolidated income tax rate of approximately (
2.5% ) to2.5% of pre-tax income; and - Diluted shares outstanding of approximately 51.5 million to 51.8 million.
Company Hosting Investor Conference Call
NorthWestern will host an investor conference call and webcast on Friday, February 12, 2021, at 3:30 p.m. Eastern time to review its financial results for the year ending December 31, 2020.
The conference call will be webcast live on the Internet at www.northwesternenergy.com under the “Our Company / Investor Relations / Presentations and Webcasts” heading or by visiting https://zoom.us/webinar/register/WN_sJnf-pP3QFSCWYGkOHiScg . To participate, please go to the site at least 10 minutes in advance of the webcast to register. An archived webcast will be available shortly after the call and remain active for one year.
About NorthWestern Energy
NorthWestern Corporation, doing business as NorthWestern Energy, provides essential energy infrastructure and valuable services that enrich lives and empower communities while serving as long-term partners to our customers and communities. We are working to deliver safe, reliable, and innovative energy solutions that create value for customers, communities, employees, and investors. This includes bridging our history as a regulated utility safely providing low-cost and reliable service with our future as a globally-aware company offering a broader array of services performed by highly-adaptable and skilled employees. We provide electricity and / or natural gas to approximately 743,000 customers in Montana, South Dakota, Nebraska and Yellowstone National Park. We have provided service in South Dakota and Nebraska since 1923 and in Montana since 2002. More information on NorthWestern Energy is available on the company's Web site at www.northwesternenergy.com.
Non-GAAP Financial Measures
This press release includes financial information prepared in accordance with GAAP, as well as other financial measures, such as Gross Margin, Adjusted Non-GAAP Pre-Tax Income, Adjusted Non-GAAP Net Income and Adjusted Non-GAAP Diluted EPS, that are considered “non-GAAP financial measures.” Generally, a non-GAAP financial measure is a numerical measure of a company’s financial performance, financial position or cash flows that exclude (or include) amounts that are included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP.
We define Gross Margin as Revenues less Cost of Sales as presented in our Condensed Consolidated Statements of Income. Management believes that Gross Margin (revenues less cost of sales) provides a useful measure for investors and other financial statement users to analyze our financial performance in that it excludes the effect on total revenues caused by volatility in energy costs and associated regulatory mechanisms. This information is intended to enhance an investor's overall understanding of results. Under our various state regulatory mechanisms, as detailed below, our supply costs are generally collected from customers. In addition, Gross Margin is used by us to determine whether we are collecting the appropriate amount of energy costs from customers to allow for recovery of operating costs, as well as to analyze how changes in loads (due to weather, economic or other conditions), rates and other factors impact our results of operations. Our Gross Margin measure may not be comparable to that of other companies' presentations or more useful than the GAAP information provided elsewhere in this report.
Management also believes the presentation of Adjusted Non-GAAP pre-tax income, net income and Diluted EPS is more representative of normal earnings than GAAP pre-tax income, net income and EPS due to the exclusion (or inclusion) of certain impacts that are not reflective of ongoing earnings. The presentation of these non-GAAP measures is intended to supplement investors' understanding of our financial performance and not to replace other GAAP measures as an indicator of actual operating performance. Our measures may not be comparable to other companies' similarly titled measures.
Special Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including, without limitation, the information under "Significant Items Not Contemplated in Earnings". Forward-looking statements often address our expected future business and financial performance, and often contain words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” or “will.” These statements are based upon our current expectations and speak only as of the date hereof. Our actual future business and financial performance may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and uncertainties, including, but not limited to:
- adverse determinations by regulators, as well as potential adverse federal, state, or local legislation or regulation, including costs of compliance with existing and future environmental requirements, could have a material effect on our liquidity, results of operations and financial condition;
- changes in availability of trade credit, creditworthiness of counterparties, usage, commodity prices, fuel supply costs or availability due to higher demand, shortages, weather conditions, transportation problems or other developments, may reduce revenues or may increase operating costs, each of which could adversely affect our liquidity and results of operations;
- unscheduled generation outages or forced reductions in output, maintenance or repairs, which may reduce revenues and increase cost of sales or may require additional capital expenditures or other increased operating costs; and
- adverse changes in general economic and competitive conditions in the U.S. financial markets and in our service territories.
Our 2020 Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, reports on Form 8-K and other Securities and Exchange Commission filings discuss some of the important risk factors that may affect our business, results of operations and financial condition. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
| Investor Relations Contact: | Media Contact: |
| Travis Meyer (605) 978-2967 | Jo Dee Black (866) 622-8081 |
| travis.meyer@northwestern.com | jodee.black@northwestern.com |
FAQ
What are NorthWestern Energy's earnings per share for 2020?
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