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TVA Reports Fiscal Year-End 2013 Results
The Tennessee Valley Authority reported Monday that the public-owned utility ended fiscal 2013 with net income of $271 million on $11 billion in operating revenues despite a decline in sales, while record levels of low-cost hydroelectric generation helped offset higher fuel costs.
“TVA reported solid financial results in 2013 despite lower sales and revenues,” TVA President and CEO Bill Johnson said.
“We experienced lower demand for power during the year due to the shutdown of a major customer facility, a slow-growing economy and adoption of energy conservation by customers,” he said. “We expect to see low growth in power demand into the next decade, and we are committed to living within our means to keep rates low for our customers and the people of the Tennessee Valley.”
Sales to local power companies were up slightly in 2013 as compared with 2012, as more normal weather patterns returned in 2013, favorably impacting demand. Sales to industrial customers directly served by TVA were off 15 percent from the prior year, primarily due to the U.S. Enrichment Corp.’s closure of its uranium enrichment facility near Paducah, Ky. Lower sales to directly served industrial customers were offset by higher off-system sales resulting from excess generation, TVA said Monday in its 2013 annual financial report to the U.S. Securities and Exchange Commission.
Total revenues declined 2 percent in 2013 compared with the prior year. The decrease was driven by a decline in base revenue as local power companies implemented new TVA wholesale rate structures, and lower fuel cost recovery revenues as a result of lower electricity sales.
Lower-cost nuclear generation was down 6 percent in 2013 versus 2012 due to four nuclear refueling outages and a steam generator replacement project, compared with two nuclear refueling outages the previous year. As a result, fuel expense increased $140 million in 2013 compared with 2012.
Record levels of rainfall in 2013 produced 42 percent more low-cost hydroelectric generation compared with 2012, which helped to partially offset higher cost generation resources.
Operating and maintenance expenses were reduced by $82 million in 2013 compared with 2012. The decrease was driven by fewer outage costs and lower scheduled maintenance for coal-fired units due to retirement or idling of less efficient coal units, and decreased costs related to post-employment benefits. Offsetting the decreases were expenses related to the four nuclear outages and other projects in 2013.
“Our company-wide efforts to enhance productivity and reduce costs will keep TVA competitive as we remain committed to fulfilling TVA’s mission,” Chief Financial Officer John Thomas said. “The actions our employees took throughout the year allowed us to end 2013 with a positive position and remain financially healthy.”
TVA reported net income of $271 million on $11 billion in operating revenues for fiscal 2013, compared with net income of $60 million on $11.2 billion in revenues last year.
TVA executive management will host a fiscal year-end 2013 financial conference call at 9:30 a.m. EST on Monday, Nov. 18, 2013. The conference call can be accessed on TVA’s website via webcast at http://www.tva.com on the Investor Relations homepage. For quick access to the live conference call, please pre-register now by going to TVA’s website before the scheduled start time and follow the instructions provided. Once pre-registered, the dial-in number will be provided via an email. If you are unable to pre-register, you may access the conference call by dialing toll free (877) 270-2148 in the United States or in Canada, or (412) 902-6510 outside the United States. A replay will be available one hour after the end of the conference call until 9:00 p.m. EST, November 26, 2013, by calling toll free (877) 344-7529 in the United States or (412) 317-0088 outside the United States and using the conference number 10034053. A webcast replay and transcript will also be available for one year on TVA’s website at http://www.tva.com/finance.
TVA’s annual report on Form 10-K provides additional financial, operational and descriptive information, including audited financial statements for the year-ended September 30, 2013, and is available to investors and the public. TVA SEC reports are also available without charge on TVA’s website at http://www.tva.com/finance or on the SEC’s website at http://www.sec.gov or by calling TVA toll free at (888) 882-4975.
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Last Update on October 30, 2014 07:33 GMT
ECONOMY-THE DAY AHEAD
WASHINGTON (AP) -- The Labor Department will report today on the number of people who applied for unemployment benefits last week. Economists forecast that weekly applications declined 2,000 to a seasonally adjusted 281,000.
Also today, the Commerce Department will release third-quarter gross domestic product figures. Many economists predict that overall growth of the economy, as measured by the gross domestic product, reached a healthy 3 percent annual rate in the July-September quarter, according to a survey by data firm FactSet.
Freddie Mac will report on average mortgage rates for this week. Last week, the average for the 30-year loan slid to 3.92 percent.
There are four major companies that will report earnings today.
Altria Group and Mastercard will report quarterly financial results before the market opens.
Starbucks and LinkedIn Corp. will report quarterly earnings after the closing bell.
SEOUL, South Korea (AP) -- Samsung Electronics Co. says its third-quarter income has plunged 49 percent to the lowest level in nearly three years as its handset business slows down.
Samsung says its net income for the July-September quarter was 4.2 trillion won ($4 billion), a sharp decline from 8.2 trillion won a year earlier. The income was the lowest since 2012 but above market expectations. Analysts polled by Factset expected 3.7 trillion won income.
Sales fell 20 percent to 47.4 trillion won while operating income shrank 60 percent to 4.1 trillion won.
Samsung warned earlier this month that its handset profit declined despite a marginal shipment increase. Analysts said the Galaxy S5 smartphone launched in April did not sell well while many consumers held off upgrading their phones, instead waiting for new iPhones.
BEIJING (AP) -- China's Cabinet says it will ease restrictions on credit card processing in a move that might help to resolve a lengthy dispute with the United States over access for Visa, Mastercard and other foreign competitors.
A Cabinet announcement said "all qualified domestic and overseas enterprises" will be allowed to apply to set up credit card clearing operations. It gave no details of what qualifications would be required for a foreign competitor to be approved.
Beijing's restrictions have given a near-monopoly on credit card processing to a state-owned entity, UnionPay.
The World Trade Organization ruled two years ago the restrictions treated foreign competitors unfairly. The government said it would review the decision but did little to increase market access.
SAN FRANCISCO (AP) -- WhatsApp founders Jan Koum and Brian Acton received 116 million shares of Facebook stock currently worth nearly $9 billion when they sold their mobile messaging service to the social networking leader earlier this month.
The breakdown of the big winners in Facebook Inc.'s $22 billion acquisition emerged Wednesday in a regulatory filing.
Koum, a Ukraine immigrant who was once living on welfare, reaped the biggest jackpot with 76.4 million Facebook shares now worth $5.8 billion. That makes him Facebook's fourth largest stockholder behind company CEO Mark Zuckerberg and two mutual funds, Fidelity Management and Vanguard.
Acton, who worked with Koum when they were both Yahoo Inc. engineers, owns 39.7 million Facebook shares worth $3 billion.
More than 45 other WhatsApp current and former employees also received Facebook stock.
WASHINGTON (AP) -- For-profit colleges that don't produce graduates capable of paying off their student loans could soon face the wrath of the federal government.
Schools with career-oriented programs that fail to comply with the new rule being announced today by the Obama administration stand to lose access to federal student-aid programs.
To meet these "gainful employment" standards, a program will have to show that the estimated annual loan payment of a typical graduate doesn't exceed 20 percent of discretionary income, or 8 percent of total earnings.
The Education Department estimates that about 1,400 programs serving 840,000 students won't pass. Nearly all of these programs are offered by for-profit schools.
SUPREME COURT-HEALTH OVERHAUL-SUBSIDIES
WASHINGTON (AP) -- Supreme Court justices have their first chance this week to decide whether they have the appetite for another major fight over President Barack Obama's health care law.
Some of the same players who mounted the first failed effort to kill the law altogether now want the justices to rule that subsidies that help millions of low- and middle-income people afford their premiums under the law are illegal.
The challengers are appealing a unanimous ruling of a three-judge panel of the federal appeals court in Richmond, Virginia, that upheld Internal Revenue Service regulations that allow health-insurance tax credits under the Affordable Care Act for consumers in all 50 states. The appeal is on the agenda for the justices' private conference on Friday, and word of their action could come as early as Monday.
DETROIT (AP) -- The U.S. government's auto safety agency, responding to criticism of its slow response to safety issues, has told the manufacturer of millions of potentially faulty air bags to make replacement parts faster and do more testing to find the cause of the problem.
The National Highway Traffic Safety Administration sent letters Wednesday to Japanese air bag maker Takata Corp. and 10 automakers seeking information in a widening air bag recall that now covers almost 8 million U.S. vehicles.
The vehicles are equipped with Takata air bags that can potentially inflate with too much force, blowing apart metal canisters and sending shards flying at drivers and passengers. Safety advocates say four people have died due to the problem.
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