Integrys Energy Group, Inc. Reports Improved Third Quarter 2011 Earnings

Printer-friendly versionPDF version

2011 Diluted EPS - Adjusted Guidance Range Narrowed to $3.33 to $3.47

Chicago - November 2, 2011 –Integrys Energy Group, Inc. (NYSE: TEG) today reported earnings on a Generally Accepted Accounting Principles (GAAP) basis and an adjusted basis as follows:

style="margin-left: auto; margin-right: auto;">

* This news release includes non-GAAP financial measures. Schedules that provide details on these measures and reconcile these measures to the most comparable GAAP figures are included with this news release.

Adjusted earnings exclude the effects of certain items that are not comparable from one period to the next.

The primary drivers of the increase in adjusted earnings were an overall decrease in operating expenses and higher margins in the retail electric markets in which Integrys Energy Services continues to operate.

Operating expenses were lower due to a continuing effort to control costs, as well as decreases in stock-based compensation expense driven by changes in the fair value of certain plans.

Integrys Energy Services' retail electric markets had positive results driven by higher unit margins and sales volumes resulting from the change in pricing and customer mix that was implemented as part of its strategy change.

Partially offsetting the increase in adjusted earnings was a decrease in regulated electric utility margins. Differences between the current Wisconsin Public Service rate order and the previous rate order drove the decrease.

"Our favorable results this year compared with last year are a reflection of the continued successful execution of our strategy," said Charles A. Schrock, Chairman, President and Chief Executive Officer of Integrys Energy Group.

Earnings Forecast

Integrys Energy Group's guidance range for 2011 diluted earnings per share on a GAAP basis was narrowed to between $3.27 and $3.41. This guidance assumes operational improvements, the availability of generation units, and normal weather conditions for the rest of 2011.

The company's guidance range for 2011 diluted earnings per share – adjusted was similarly narrowed to between $3.33 and $3.47.

Supplemental Data Package

A supplemental data package has been posted on Integrys Energy Group's website. It includes this news release, as well as financial statements, non‐GAAP financial information, guidance information for diluted earnings per share, and quarterly financial information by reportable segment. The supplemental data package can be found athttp://www.integrysgroup.com/investor/presentations.aspx.

Conference Call

An earnings conference call is scheduled for 8 a.m. Central time on Thursday, November 3, 2011. The call can be accessed 15 minutes prior to the scheduled start time by dialing 888‐788‐9425. Callers will be required to supply EARNINGS as the passcode and MR. STEVEN ESCHBACH as the leader. A replay of the conference call will be available through February 27, 2012, by dialing 888‐568‐0145.

Investors may also listen to the live conference or a replay on Integrys Energy Group's website athttp://www.integrysgroup.com/investor/presentations.aspx.

PowerPoint slides will be posted on the website and will be referred to within the prepared remarks during the call. The slides will be available at 6 a.m. Central time on November 3.

Forward-Looking Statements

Financial results in this news release are unaudited. In this news release, Integrys Energy Group makes statements concerning expectations, beliefs, plans, objectives, goals, strategies, and future events or performance. Such statements are "forward‐looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Forward‐looking statements are subject to assumptions and uncertainties; therefore, actual results may differ materially from those expressed or implied by such forward‐looking statements. Although Integrys Energy Group believes that these forward‐looking statements and the underlying assumptions are reasonable, it cannot provide assurance that such statements will prove correct.

Forward‐looking statements include, among other things, statements concerning management's expectations and projections regarding earnings, regulatory matters, fuel and natural gas costs, sources of electric energy supply, coal and natural gas deliveries, remediation costs, environmental expenditures, liquidity and capital resources, trends, estimates, completion of construction projects, and other matters.

Forward‐looking statements involve a number of risks and uncertainties. Some risks that could cause results to differ from any forward‐looking statement include those described in Item 1A of Integrys Energy Group's Annual Report on Form 10‐K for the year ended December 31, 2010, as may be amended or supplemented in Quarterly Reports on Form 10‐Q. Other risks and uncertainties include, but are not limited to:

• Resolution of pending and future rate cases and negotiations (including the recovery of deferred costs) and other regulatory decisions impacting the regulated businesses;
• The individual and cumulative impact of recent and future federal and state regulatory changes, including legislative and regulatory initiatives regarding deregulation and restructuring of the electric and natural gas utility industries; financial reform; health care reform; changes in environmental and other regulations, including but not limited to, greenhouse gas emissions, other environmental regulations impacting coal‐fired generation facilities, energy efficiency mandates, renewable energy standards, and reliability standards; and changes in tax and other laws and regulations to which Integrys Energy Group and its subsidiaries are subject;
• Current and future litigation and regulatory proceedings, enforcement actions or inquiries, including but not limited to, manufactured gas plant site cleanup, third‐party intervention in permitting and licensing projects, compliance with Clean Air Act requirements at generation plants, and prudence and reconciliation of costs recovered in revenues through automatic gas cost recovery mechanisms;
• The impacts of changing financial market conditions, credit ratings, and interest rates on the liquidity and financing efforts of Integrys Energy Group and its subsidiaries;
• The risks associated with changing commodity prices (particularly natural gas and electricity) and the available sources of fuel, natural gas, and purchased power, including their impact on margins, working capital, and liquidity requirements;
• Resolution of audits or other tax disputes with the United States Internal Revenue Service and various state, local, and Canadian revenue agencies;
• The effects, extent, and timing of additional competition or regulation in the markets in which Integrys Energy Group's subsidiaries operate;
• The retention of market‐based rate authority;
• The risk associated with the value of goodwill or other intangible assets and their possible impairment;
• Investment performance of employee benefit plan assets, including actuarial assumptions, and the related impact on future funding requirements;
• Changes in technology, particularly with respect to new, developing, or alternative sources of generation;
• Effects of and changes in political and legal developments, as well as economic conditions and the related impact on customer demand, including the ability to attract and retain customers for Integrys Energy Services and to adequately forecast energy usage for all of Integrys Energy Group's customers;
• Potential business strategies, including mergers, acquisitions, and construction or disposition of assets or businesses, which cannot be assured to be completed timely or within budgets;
• The direct or indirect effects of terrorist incidents, natural disasters, or responses to such events;
• The effectiveness of risk management strategies, the use of financial and derivative instruments, and the ability to recover costs from customers in rates associated with the use of those strategies and financial and derivative instruments;
• The risk of financial loss, including increases in bad debt expense, associated with the inability of Integrys Energy Group's and its subsidiaries' counterparties, affiliates, and customers to meet their obligations;
• Customer usage, weather, and other natural phenomena;
• The use of tax credit and loss carryforwards;
• Contributions to earnings by non‐consolidated equity method and other investments, which may vary from projections;
• The effect of accounting pronouncements issued periodically by standard‐setting bodies; and
• Other factors discussed in Integrys Energy Group's 2010 Annual Report on Form 10‐K and in other reports filed from time to time with the United States Securities and Exchange Commission.

Except to the extent required by the federal securities laws, Integrys Energy Group undertakes no obligation to publicly update or revise any forward‐looking statements, whether as a result of new information, future events, or otherwise.

About Integrys Energy Group, Inc.

Integrys Energy Group is a diversified energy holding company with regulated electric and natural gas utility operations (serving customers in Illinois, Michigan, Minnesota, and Wisconsin), nonregulated energy operations, and an approximate 34% equity ownership interest in American Transmission Company (a federally regulated electric transmission company operating in Wisconsin, Michigan, Minnesota, and Illinois).

More information is available atwww.integrysgroup.com.

For More Information, Contact:

• Steven P. Eschbach, CFA
  Vice President – Investor Relations
  Integrys Energy Group, Inc.
  (312) 228‐540
  
  
  

News Source : Integrys Energy Group, Inc. Reports Improved Third Quarter 2011 Earnings