Southern Company reports fourth-quarter and full-year 2018 earnings

ATLANTA, Feb. 20, 2019 /PRNewswire/ -- Southern Company today reported fourth-quarter 2018 earnings of $278 million, or 27 cents per share, compared with earnings of $496 million, or 49 cents per share, in the fourth quarter of 2017.  Southern Company also reported full-year 2018 earnings of $2.23 billion, or $2.18 per share, compared with earnings of $842 million, or 84 cents per share, in 2017.

Southern Company (PRNewsFoto/Southern Company) (PRNewsfoto/Southern Company)

Excluding the items described in the "Net Income – Excluding Items" table below, Southern Company earned $256 million, or 25 cents per share, during the fourth quarter of 2018, compared with $509 million, or 51 cents per share, during the fourth quarter of 2017.  For the full-year 2018, excluding these items, Southern Company earned $3.13 billion, or $3.07 per share, compared with earnings of $3.02 billion, or $3.02 per share, in 2017.

Non-GAAP Financial Measures

Three Months Ended December


Year-to-Date December

Net Income - Excluding Items (in millions)

2018

2017


2018

2017

Net Income - As Reported

$278

$496


$2,226

$842

Estimated Loss on Plants Under Construction

(6)

211


1,102

3,366

  Tax Impact

(94)

(25)


(376)

(975)

Loss on Plant Scherer Unit 3

-

-


-

33

Tax Impact

-

-


-

(13)

Acquisition, Disposition, and Integration Impacts

58

16


(35)

35

       Tax Impact

(11)

10


294

12

Wholesale Gas Services

41

105


(42)

57

       Tax Impact

(14)

(20)


4

-

Litigation Settlement

-

-


(24)

-

       Tax Impact

-

-


6

-

Earnings Guidance Comparability Items:






Equity Return Related to Kemper IGCC

    Schedule Extension

-

-


-

(47)

       Tax Impact

-

-


-

(9)

Adoption of Tax Reform

4

(284)


(27)

(284)

Net Income – Excluding Items

$256

$509


$3,128

$3,017

       Average Shares Outstanding – (in millions)                     

1,034

1,007


1,020

1,000

Basic Earnings Per Share – Excluding Items

$0.25

$0.51


$3.07

$3.02







NOTE: For more information regarding these non-GAAP adjustments, see the footnotes accompanying the Financial Highlights page of the
earnings package.

Earnings drivers for the full year 2018 were positively influenced by effects of constructive regulatory outcomes and weather at the state-regulated utilities. These impacts were partially offset by increases in depreciation and amortization, interest expense and share issuances.

"2018 was a banner year for Southern Company, as we continued to see outstanding operational execution throughout the franchise," said Chairman, President and CEO Thomas A. Fanning. "All of our state-regulated electric and gas companies delivered strong performance. We experienced solid customer growth, and we delivered significant benefits to customers resulting from tax reform while maintaining credit metrics across our businesses. We also saw excellent progress with the construction of the new nuclear units at Georgia Power's Plant Vogtle, achieving our year-end construction targets."

Fourth quarter 2018 operating revenues were $5.34 billion, compared with $5.63 billion for the fourth quarter of 2017, a decrease of 5.2 percent.  Operating revenues for the full year 2018 were $23.50 billion, compared with $23.03 billion in 2017, an increase of 2.0 percent.

Southern Company's fourth quarter earnings slides with supplemental financial information, including its earnings guidance for 2019, are available at http://investor.southerncompany.com.

Southern Company's financial analyst call will begin at 8 a.m. Eastern Time today, during which Fanning and Chief Financial Officer Andrew W. Evans will discuss earnings and provide a general business update. Investors, media and the public may listen to a live webcast of the call and view associated slides at http://investor.southerncompany.com/webcasts. A replay of the webcast will be available on the site for 12
months.

About Southern Company

Southern Company (NYSE: SO) is a leading energy company serving 9 million customers through its subsidiaries as of Jan. 1, 2019. The company provides clean, safe, reliable and affordable energy through electric operating companies in three states, natural gas distribution companies in four states, a competitive generation company serving wholesale customers across America, a leading distributed energy infrastructure company, a fiber optics network and telecommunications services. Southern Company brands are known for excellent customer service, high reliability and affordable prices below the national average. For more than a century, we have been building the future of energy and developing the full portfolio of energy resources, including carbon-free nuclear, advanced carbon capture technologies, natural gas, renewables, energy efficiency and storage technology. Through an industry-leading commitment to innovation and a low-carbon future, Southern Company and its subsidiaries develop the customized energy solutions our customers and communities require to drive growth and prosperity. Our uncompromising values ensure we put the needs of those we serve at the center of everything we do and govern our business to the benefit of our world. Our corporate culture and hiring practices have been recognized nationally by the U.S. Department of Defense, G.I. Jobs magazine, DiversityInc, Black Enterprise, Forbes and the Women's Choice Award. To learn more, visit www.southerncompany.com.

 

 

Southern Company

Financial Highlights

(In Millions of Dollars Except Earnings Per Share)












Three Months Ended
December


Year-to-Date

December

Net Income–As Reported (See Notes)


2018


2017


2018


2017










  Traditional Electric Operating Companies


$

407



$

(191)



$

2,117



$

(193)


  Southern Power


(48)



795



187



1,071


Southern Company Gas


78



(60)



372



243


  Total


437



544



2,676



1,121


  Parent Company and Other


(159)



(48)



(450)



(279)


  Net Income–As Reported


$

278



$

496



$

2,226



$

842











  Basic Earnings Per Share1


$

0.27



$

0.49



$

2.18



$

0.84











  Average Shares Outstanding (in millions)


1,034



1,007



1,020



1,000


  End of Period Shares Outstanding (in millions)






1,034



1,008











Non-GAAP Financial Measures


Three Months Ended
December


Year-to-Date

December

Net Income–Excluding Items (See Notes)


2018


2017


2018


2017










  Net Income–As Reported


$

278



$

496



$

2,226



$

842


Estimated Loss on Plants Under Construction2


(6)



211



1,102



3,366


Tax Impact


(94)



(25)



(376)



(975)


Loss on Plant Scherer Unit 33








33


Tax Impact








(13)


Acquisition, Disposition, and Integration Impacts4


58



16



(35)



35


Tax Impact


(11)



10



294



12


Wholesale Gas Services5


41



105



(42)



57


Tax Impact


(14)



(20)



4




Litigation Settlement6






(24)




Tax Impact






6




Earnings Guidance Comparability Items:









Equity Return Related to Kemper IGCC

   Schedule Extension7








(47)


Tax Impact








(9)


Adoption of Tax Reform8


4



(284)



(27)



(284)


  Net Income–Excluding Items


$

256



$

509



$

3,128



$

3,017











  Basic Earnings Per Share–Excluding Items


$

0.25



$

0.51



$

3.07



$

3.02











-See Notes on the following page.

 

 

Southern Company

Financial Highlights


Notes









(1) For the three and twelve months ended December 31, 2018 and 2017, dilution does not change basic earnings per share by more than 1 cent and is not material.

(2) Earnings for the three and twelve months ended December 31, 2018 and 2017 include charges and associated legal expenses related to Mississippi Power's integrated coal gasification combined cycle facility project in Kemper County, Mississippi (Kemper IGCC). Additionally, the three and twelve months ended December 31, 2018 include a $95 million credit to earnings primarily resulting from the reduction of a state income tax valuation allowance recorded in the twelve months ended December 31, 2017 related to a net operating loss carryforward associated with the Kemper IGCC. Earnings for the twelve months ended December 31, 2018 also include a $1.1 billion charge ($0.8 billion after tax) for an estimated probable loss on Georgia Power's construction of Plant Vogtle Units 3 and 4. These items significantly impacted the presentation of earnings and earnings per share. Additional pre-tax closure costs, including mine reclamation, of up to $25 million for Mississippi Power's Kemper IGCC may occur through 2020. Mississippi Power is also currently evaluating its options regarding the final disposition of the carbon dioxide pipeline and is in discussions with the Department of Energy regarding property closeout and disposition, for which the related costs could be material. Further charges for Georgia Power's Plant Vogtle Units 3 and 4 may occur; however, the amount and timing of any such charges is uncertain.

(3) Earnings for the twelve months ended December 31, 2017 include a $32.5 million write-down ($20 million after tax) of Gulf Power's ownership of Plant Scherer Unit 3 as a result of its 2017 retail rate case settlement.

(4) Earnings for the three months ended December 31, 2018 include: (i) a net combined $27 million pre-tax loss (net combined $15 million after-tax loss) in connection with the finalization of the gain and loss calculations for the sales of Elizabethtown Gas, Elkton Gas, Florida City Gas, and Pivotal Home Solutions by Southern Company Gas and (ii) other acquisition, disposition, and integration costs of $31 million pre tax ($32 million after tax, which includes $10 million related to reapportioning state income taxes as a result of the dispositions). Earnings for the twelve months ended December 31, 2018 include: (i) a net combined $291 million pre-tax gain ($51 million after-tax loss) on the sales of Elizabethtown Gas, Elkton Gas, Florida City Gas, and Pivotal Home Solutions by Southern Company Gas; (ii) a $42 million (pre tax and after tax) goodwill impairment charge associated with the sale of Pivotal Home Solutions; (iii) a $119 million pre-tax ($89 million after tax) impairment charge associated with Southern Power's disposition of Plants Stanton and Oleander; and (iv) $95 million pre tax ($77 million after tax) of other acquisition, disposition, and integration costs. Earnings for the three and twelve months ended December 31, 2017 include other acquisition, disposition, and integration costs related to the acquisition of Southern Company Gas and the dispositions of Elizabethtown Gas and Elkton Gas. Further impacts are expected to be recorded in 2019 including a preliminary gain of $2.5 billion pre tax ($1.3 billion after tax) in connection with the sale of Gulf Power, as well as impacts related to Southern Power's announced sale of Plant Mankato. Further costs are also expected to continue to occur in connection with the integration of Southern Company Gas; however, the amount and duration of such expenditures is uncertain.

(5) Earnings for the three and twelve months ended December 31, 2018 and 2017 include the Wholesale Gas Services business of Southern Company Gas. Presenting earnings and earnings per share excluding Wholesale Gas Services provides investors with an additional measure of operating performance that excludes the volatility resulting from mark-to-market and lower of weighted average cost or current market price accounting adjustments.

(6) Earnings for the twelve months ended December 31, 2018 include the settlement proceeds of Mississippi Power's claim for lost revenue resulting from the 2010 Deepwater Horizon oil spill in the Gulf of Mexico. Further proceeds are not expected.

(7) Earnings for the twelve months ended December 31, 2017 include allowance for funds used during construction (AFUDC) equity as a result of extending the Kemper IGCC construction schedule beyond November 30, 2016, as assumed when Southern Company issued its 2017 guidance. As a result, Southern Company believes presentation of earnings per share excluding these amounts provides investors with information comparable to guidance. Management also used such measures to evaluate Southern Company's 2017 performance. AFUDC equity ceased in connection with the project's suspension in June 2017.

(8) Earnings for the three and twelve months ended December 31, 2018 and 2017 include net tax impacts as a result of implementing federal tax reform legislation, which was signed into law in December 2017. During 2018, Southern Company obtained and analyzed additional information that was not initially available or reported as provisional amounts at December 31, 2017. Additional adjustments are not expected. Southern Company believes presentation of earnings per share excluding these amounts provides investors with information comparable to guidance. Management also used such measures to evaluate Southern Company's performance.

 

 

Southern Company

Significant Factors Impacting EPS
















Three Months Ended
December


Year-to-Date
December



2018


2017


Change


2018


2017


Change

Earnings Per Share–













As Reported1 (See Notes)


$

0.27



$

0.49



$

(0.22)



$

2.18



$

0.84



$

1.34















  Significant Factors:













  Traditional Electric Operating Companies






$

0.59







$

2.31


Southern Power






(0.84)







(0.88)


Southern Company Gas






0.14







0.13


Parent Company and Other






(0.10)







(0.18)


Increase in Shares






(0.01)







(0.04)


  Total–As Reported






$

(0.22)







$

1.34

















Three Months Ended
December


Year-to-Date
December

Non-GAAP Financial Measures


2018


2017


Change


2018


2017


Change

Earnings Per Share–













Excluding Items (See Notes)


$

0.25



$

0.51



$

(0.26)



$

3.07



$

3.02



$

0.05















  Total–As Reported






$

(0.22)







$

1.34


Estimated Loss on Plants Under Construction2






(0.29)







(1.62)


Loss on Plant Scherer Unit 33












(0.02)


Acquisition, Disposition, and Integration

    Impacts4






0.02







0.21


Wholesale Gas Services5






(0.05)







(0.09)


Litigation Settlement6












(0.02)


Adoption of Tax Reform7






0.28







0.25


  Total–Excluding Items






$

(0.26)







$

0.05















- See Notes on the following page.

 

 

Southern Company

Significant Factors Impacting EPS

Notes














(1) For the three and twelve months ended December 31, 2018 and 2017, dilution does not change basic earnings per share by more than 1 cent and is not material.

(2) Earnings for the three and twelve months ended December 31, 2018 and 2017 include charges and associated legal expenses related to Mississippi Power's integrated coal gasification combined cycle facility project in Kemper County, Mississippi (Kemper IGCC). Additionally, the three and twelve months ended December 31, 2018 include a $95 million credit to earnings primarily resulting from the reduction of a state income tax valuation allowance recorded in the twelve months ended December 31, 2017 related to a net operating loss carryforward associated with the Kemper IGCC. Earnings for the twelve months ended December 31, 2018 also include a $1.1 billion charge ($0.8 billion after tax) for an estimated probable loss on Georgia Power's construction of Plant Vogtle Units 3 and 4. These items significantly impacted the presentation of earnings and earnings per share. Additional pre-tax closure costs, including mine reclamation, of up to $25 million for Mississippi Power's Kemper IGCC may occur through 2020. Mississippi Power is also currently evaluating its options regarding the final disposition of the carbon dioxide pipeline and is in discussions with the Department of Energy regarding property closeout and disposition, for which the related costs could be material. Further charges for Georgia Power's Plant Vogtle Units 3 and 4 may occur; however, the amount and timing of any such charges is uncertain.

 

Earnings for the twelve months ended December 31, 2017 include allowance for funds used during construction (AFUDC) equity as a result of extending the Kemper IGCC construction schedule beyond November 30, 2016, as assumed when Southern Company issued its 2017 guidance. As a result, Southern Company believes presentation of earnings per share excluding these amounts provides investors with information comparable to guidance. Management also used such measures to evaluate Southern Company's 2017 performance. AFUDC equity ceased in connection with the project's suspension in June 2017.

(3) Earnings for the twelve months ended December 31, 2017 include a $32.5 million write-down ($20 million after tax) of Gulf Power's ownership of Plant Scherer Unit 3 as a result of its 2017 retail rate case settlement.

(4) Earnings for the three months ended December 31, 2018 include: (i) a net combined $27 million pre-tax loss (net combined $15 million after-tax loss) in connection with the finalization of the gain and loss calculations for the sales of Elizabethtown Gas, Elkton Gas, Florida City Gas, and Pivotal Home Solutions by Southern Company Gas and (ii) other acquisition, disposition, and integration costs of $31 million pre tax ($32 million after tax, which includes $10 million related to reapportioning state income taxes as a result of the dispositions). Earnings for the twelve months ended December 31, 2018 include: (i) a net combined $291 million pre-tax gain ($51 million after-tax loss) on the sales of Elizabethtown Gas, Elkton Gas, Florida City Gas, and Pivotal Home Solutions by Southern Company Gas; (ii) a $42 million (pre tax and after tax) goodwill impairment charge associated with the sale of Pivotal Home Solutions; (iii) a $119 million pre-tax ($89 million after tax) impairment charge associated with Southern Power's disposition of Plants Stanton and Oleander; and (iv) $95 million pre tax ($77 million after tax) of other acquisition, disposition, and integration costs. Earnings for the three and twelve months ended December 31, 2017 include other acquisition, disposition, and integration costs related to the acquisition of Southern Company Gas and the dispositions of Elizabethtown Gas and Elkton Gas. Further impacts are expected to be recorded in 2019 including a preliminary gain of $2.5 billion pre tax ($1.3 billion after tax) in connection with the sale of Gulf Power, as well as impacts related to Southern Power's announced sale of Plant Mankato. Further costs are also expected to continue to occur in connection with the integration of Southern Company Gas; however, the amount and duration of such expenditures is uncertain.

(5) Earnings for the three and twelve months ended December 31, 2018 and 2017 include the Wholesale Gas Services business of Southern Company Gas. Presenting earnings and earnings per share excluding Wholesale Gas Services provides investors with an additional measure of operating performance that excludes the volatility resulting from mark-to-market and lower of weighted average cost or current market price accounting adjustments.

(6) Earnings for the twelve months ended December 31, 2018 include the settlement proceeds of Mississippi Power's claim for lost revenue resulting from the 2010 Deepwater Horizon oil spill in the Gulf of Mexico. Further proceeds are not expected.

(7) Earnings for the three and twelve months ended December 31, 2018 and 2017 include net tax impacts as a result of implementing federal tax reform legislation, which was signed into law in December 2017. During 2018, Southern Company obtained and analyzed additional information that was not initially available or reported as provisional amounts at December 31, 2017. Additional adjustments are not expected. Southern Company believes presentation of earnings per share excluding these amounts provides investors with information comparable to guidance. Management also used such measures to evaluate Southern Company's performance.

 

 


Southern Company

EPS Earnings Analysis

Description


Three Months Ended
December
2018 vs. 2017


Year-to-Date
December 
2018 vs. 2017






Retail Sales


$0.01


$0.05






Retail Revenue Impacts, Excluding Tax Reform Changes


(0.10)


(0.08)






Weather



0.18






Other Operating Revenues



(0.01)






Purchased Power Capacity Expense



0.01






Non-Fuel O&M


0.01


0.02






Depreciation and Amortization


(0.01)


(0.07)






Taxes Other Than Income Taxes



(0.02)






Gain on Dispositions, Net


(0.02)


(0.02)






Interest Expense


0.01


(0.02)






Other Income and Deductions



0.01






Impacts of Tax Reform (Ongoing Basis), Net of Amounts
to be Returned to Customers


(0.04)


0.15






Income Taxes, Excluding Tax Reform



(0.04)






Dividends on Preferred and Preference Stock



0.02






Total Traditional Electric Operating Companies


$(0.14)


$0.18






Southern Power


(0.03)


0.02






Southern Company Gas


(0.01)


0.04






Parent and Other


(0.07)


(0.13)






Increase in Shares


(0.01)


(0.06)






Total Change in EPS (Excluding Items)


$(0.26)


$0.05






Estimated Loss on Plants Under Construction1


0.29


1.62






Loss on Plant Scherer Unit 32



0.02






Acquisition, Disposition, and Integration Impacts3


(0.02)


(0.21)






Wholesale Gas Services4


0.05


0.09






Litigation Settlement5



0.02






Adoption of Tax Reform6


(0.28)


(0.25)






Total Change in EPS (As Reported)


$(0.22)


$1.34






- See Notes on the following page.


















 

 

Southern Company

EPS Earnings Analysis

Three and Twelve Months Ended December 2018 vs. December 2017

Notes


(1) Earnings for the three and twelve months ended December 31, 2018 and 2017 include charges and associated legal expenses related to Mississippi Power's integrated coal gasification combined cycle facility project in Kemper County, Mississippi (Kemper IGCC). Additionally, the three and twelve months ended December 31, 2018 include a $95 million credit to earnings primarily resulting from the reduction of a state income tax valuation allowance recorded in the twelve months ended December 31, 2017 related to a net operating loss carryforward associated with the Kemper IGCC. Earnings for the twelve months ended December 31, 2018 also include a $1.1 billion charge ($0.8 billion after tax) for an estimated probable loss on Georgia Power's construction of Plant Vogtle Units 3 and 4. These items significantly impacted the presentation of earnings and earnings per share. Additional pre-tax closure costs, including mine reclamation, of up to $25 million for Mississippi Power's Kemper IGCC may occur through 2020. Mississippi Power is also currently evaluating its options regarding the final disposition of the carbon dioxide pipeline and is in discussions with the Department of Energy regarding property closeout and disposition, for which the related costs could be material. Further charges for Georgia Power's Plant Vogtle Units 3 and 4 may occur; however, the amount and timing of any such charges is uncertain.

 

Earnings for the twelve months ended December 31, 2017 include allowance for funds used during construction (AFUDC) equity as a result of extending the Kemper IGCC construction schedule beyond November 30, 2016, as assumed when Southern Company issued its 2017 guidance. As a result, Southern Company believes presentation of earnings per share excluding these amounts provides investors with information comparable to guidance. Management also used such measures to evaluate Southern Company's 2017 performance. AFUDC equity ceased in connection with the project's suspension in June 2017.

(2) Earnings for the twelve months ended December 31, 2017 include a $32.5 million write-down ($20 million after tax) of Gulf Power's ownership of Plant Scherer Unit 3 as a result of its 2017 retail rate case settlement.

(3) Earnings for the three months ended December 31, 2018 include: (i) a net combined $27 million pre-tax loss (net combined $15 million after-tax loss) in connection with the finalization of the gain and loss calculations for the sales of Elizabethtown Gas, Elkton Gas, Florida City Gas, and Pivotal Home Solutions by Southern Company Gas and (ii) other acquisition, disposition, and integration costs of $31 million pre tax ($32 million after tax, which includes $10 million related to reapportioning state income taxes as a result of the dispositions). Earnings for the twelve months ended December 31, 2018 include: (i) a net combined $291 million pre-tax gain ($51 million after-tax loss) on the sales of Elizabethtown Gas, Elkton Gas, Florida City Gas, and Pivotal Home Solutions by Southern Company Gas; (ii) a $42 million (pre tax and after tax) goodwill impairment charge associated with the sale of Pivotal Home Solutions; (iii) a $119 million pre-tax ($89 million after tax) impairment charge associated with Southern Power's disposition of Plants Stanton and Oleander; and (iv) $95 million pre tax ($77 million after tax) of other acquisition, disposition, and integration costs. Earnings for the three and twelve months ended December 31, 2017 include other acquisition, disposition, and integration costs related to the acquisition of Southern Company Gas and the dispositions of Elizabethtown Gas and Elkton Gas. Further impacts are expected to be recorded in 2019 including a preliminary gain of $2.5 billion pre tax ($1.3 billion after tax) in connection with the sale of Gulf Power, as well as impacts related to Southern Power's announced sale of Plant Mankato. Further costs are also expected to continue to occur in connection with the integration of Southern Company Gas; however, the amount and duration of such expenditures is uncertain.

(4) Earnings for the three and twelve months ended December 31, 2018 and 2017 include the Wholesale Gas Services business of Southern Company Gas. Presenting earnings and earnings per share excluding Wholesale Gas Services provides investors with an additional measure of operating performance that excludes the volatility resulting from mark-to-market and lower of weighted average cost or current market price accounting adjustments.

(5) Earnings for the twelve months ended December 31, 2018 include the settlement proceeds of Mississippi Power's claim for lost revenue resulting from the 2010 Deepwater Horizon oil spill in the Gulf of Mexico. Further proceeds are not expected.

(6) Earnings for the three and twelve months ended December 31, 2018 and 2017 include net tax impacts as a result of implementing federal tax reform legislation, which was signed into law in December 2017. During 2018, Southern Company obtained and analyzed additional information that was not initially available or reported as provisional amounts at December 31, 2017. Additional adjustments are not expected. Southern Company believes presentation of earnings per share excluding these amounts provides investors with information comparable to guidance. Management also used such measures to evaluate Southern Company's performance.

 

 

Southern Company

Consolidated Earnings

As Reported

(In Millions of Dollars)
















Three Months Ended
December


Year-to-Date

 December



2018


2017


Change


2018


2017


Change

Income Account-













Retail Electric Revenues-













Fuel


$

1,012



$

966



$

46



$

4,283



$

4,095



$

188


Non-Fuel


2,297



2,578



(281)



10,939



11,235



(296)


Wholesale Electric Revenues


579



559



20



2,516



2,426



90


Other Electric Revenues


166



171



(5)



664



681



(17)


Natural Gas Revenues


1,048



1,045



3



3,854



3,791



63


Other Revenues


235



310



(75)



1,239



803



436


Total Revenues


5,337



5,629



(292)



23,495



23,031



464


Fuel and Purchased Power


1,334



1,245



89



5,608



5,263



345


Cost of Natural Gas


486



515



(29)



1,539



1,601



(62)


Cost of Other Sales


118



220



(102)



806



513



293


Non-Fuel O & M


1,672



1,640



32



5,889



5,739



150


Depreciation and Amortization


793



774



19



3,131



3,010



121


Taxes Other Than Income Taxes


325



309



16



1,315



1,250



65


Estimated Loss on Plants Under Construction


(8)



207



(215)



1,097



3,362



(2,265)


Impairment Charges


13





13



210





210


Gain on Dispositions, net


26



(20)



46



(291)



(40)



(251)


Total Operating Expenses


4,759



4,890



(131)



19,304



20,698



(1,394)


Operating Income


578



739



(161)



4,191



2,333



1,858


Allowance for Equity Funds Used During
Construction


39



27



12



138



160



(22)


Earnings from Equity Method Investments


40



6



34



148



106



42


Interest Expense, Net of Amounts Capitalized


456



446



10



1,842



1,694



148


Other Income (Expense), net


(81)



(1)



(80)



114



163



(49)


Income Taxes


(149)



(175)



26



449



142



307


Net Income


269



500



(231)



2,300



926



1,374


Less:













Dividends on Preferred and Preference Stock
of Subsidiaries


4



6



(2)



16



38



(22)


Net Income Attributable to Noncontrolling
Interests


(13)



(2)



(11)



58



46



12


NET INCOME ATTRIBUTABLE TO
SOUTHERN COMPANY


$

278



$

496



$

(218)



$

2,226



$

842



$

1,384















Notes


























- Certain prior year data may have been reclassified to conform with current year presentation.

 

 


Southern Company

Kilowatt-Hour Sales and Customers

(In Millions of KWHs)




















Three Months Ended December


Year-to-Date December

As Reported


2018


2017


Change


Weather
Adjusted
Change


2018


2017


Change


Weather
Adjusted
Change

Kilowatt-Hour Sales-

















Total Sales


49,539



49,915



(0.8)

%




212,144



205,541



3.2

%




















Total Retail Sales-


37,973



37,705



0.7

%


0.3

%


162,182



156,507



3.6

%


0.9

%

Residential


12,475



12,034



3.7

%


2.2

%


54,590



50,536



8.0

%


1.2

%

Commercial


12,346



12,333



0.1

%


0.3

%


53,451



52,340



2.1

%


0.5

%

Industrial


12,949



13,130



(1.4)

%


(1.4)

%


53,341



52,785



1.1

%


1.1

%

Other


203



208



(3.1)

%


(3.2)

%


800



846



(5.5)

%


(5.7)

%


















Total Wholesale Sales


11,566



12,210



(5.3)

%


N/A


49,962



49,034



1.9

%


N/A




















































(In Thousands of Customers)




























Period Ended December













2018


2017


Change



Regulated Utility Customers-













Total Utility Customers1-






8,933



9,263



(3.6)

%



Total Traditional Electric






4,685



4,640



1.0

%



Southern Company Gas1






4,248



4,623



(8.1)

%







































































Notes


































(1) Includes total customers of approximately 407,000 at December 31, 2017 related to Elizabethtown Gas, Elkton Gas, and Florida City Gas,
which were sold in July 2018.

















































 

 

Southern Company

Financial Overview

As Reported

(In Millions of Dollars)
















Three Months Ended
December


Year-to-Date

December



2018


2017


% Change


2018


2017


% Change

Southern Company1













Operating Revenues


$

5,337



$

5,629



(5.2)

%


$

23,495



$

23,031



2.0

%

Earnings Before Income Taxes


120



325



(63.1)

%


2,749



1,068



157.4

%

Net Income Available to Common


278



496



(44.0)

%


2,226



842



164.4

%














Alabama Power –













Operating Revenues


$

1,316



$

1,433



(8.2)

%


$

6,032



$

6,039



(0.1)

%

Earnings Before Income Taxes


96



198



(51.5)

%


1,236



1,434



(13.8)

%

Net Income Available to Common


73



119



(38.7)

%


930



848



9.7

%














Georgia Power –













Operating Revenues


$

1,818



$

1,884



(3.5)

%


$

8,420



$

8,310



1.3

%

Earnings Before Income Taxes


175



352



(50.3)

%


1,007



2,258



(55.4)

%

Net Income Available to Common


173



227



(23.8)

%


793



1,414



(43.9)

%














Gulf Power –













Operating Revenues


$

359



$

372



(3.5)

%


$

1,465



$

1,516



(3.4)

%

Earnings Before Income Taxes


(6)



30



(120.0)

%


140



229



(38.9)

%

Net Income Available to Common


13



19



(31.6)

%


160



135



18.5

%














Mississippi Power –













Operating Revenues


$

308



$

271



13.7

%


$

1,265



$

1,187



6.6

%

Earnings (Loss) Before Income Taxes


24



(202)



N/M


134



(3,120)



N/M

Net Income (Loss) Available to Common


149



(556)



N/M


235



(2,590)



N/M














Southern Power1













Operating Revenues


$

506



$

478



5.9

%


$

2,205



$

2,075



6.3

%

Earnings Before Income Taxes


(14)



(17)



N/M


82



178



(53.9)

%

Net Income Available to Common


(48)



795



N/M


187



1,071



(82.5)

%














Southern Company Gas1













Operating Revenues


$

1,048



$

1,079



(2.9)

%


$

3,909



$

3,920



(0.3)

%

Earnings Before Income Taxes


67



74



(9.5)

%


836



610



37.0

%

Net Income Available to Common


78



(60)



N/M


372



243



53.1

%














N/M - not meaningful


























Notes


























- See Financial Highlights pages for discussion of certain significant items occurring during the periods presented.

(1) Financial comparisons to the prior year were impacted by (i) Southern Company Gas' disposition of: (a) Pivotal Home Solutions on June 4, 2018, (b) Elizabethtown Gas and Elkton Gas on July 1, 2018, and (c) Florida City Gas on July 29, 2018; (ii) the disposition of Southern Power Company's ownership interest in Plants Oleander and Stanton on December 4, 2018; and (iii) Southern Power Company's sale of (a) a 33% equity interest in a limited partnership indirectly owning substantially all of its solar facilities on May 22, 2018 and (b) a noncontrolling interest in its subsidiary owning eight operating wind facilities on December 11, 2018.

 

SOURCE Southern Company

For further information: Media Contact: Southern Company Media Relations, 404-506-5333 or 1-866-506-5333; Investor Relations Contact: Scott Gammill, 404-506-0901, sagammil@southernco.com