Item 2. Management's Discussion and Analysis of Financial Condition And
Item 4. Controls and Procedures
Part II - Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 6. Exhibits
Exhibits
EX-31.1
bhpex-311q12019.htm
EX-31.2
bhpex-312q12019.htm
EX-32.1
bhpex-321q12019.htm
EX-32.2
bhpex-322q12019.htm
Black Hills Power Earnings 2019-03-31
BKH 10Q Quarterly Report
Balance Sheet
Income Statement
Cash Flow
Document
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2019
OR
o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________.
Commission File Number 1-7978
Black Hills Power, Inc.
Incorporated in South Dakota
IRS Identification Number 46-0111677
7001 Mount Rushmore Road
Rapid City, South Dakota 57702
Registrant’s telephone number (605) 721-1700
Former name, former address, and former fiscal year if changed since last report
NONE
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes x
No o
Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files).
Yes x
No o
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
o
Accelerated filer
o
Non-accelerated filer
x
(Do not check if a smaller reporting company)
Smaller reporting company
o
Emerging growth company
o
If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes o
No x
Securities registered pursuant to Section 12(b) of the Act: None
As of April 30, 2019, there were issued and outstanding 23,416,396 shares of the Registrant’s common stock, $1.00 par value, all of which were held beneficially and of record by Black Hills Corporation.
Reduced Disclosure
The Registrant meets the conditions set forth in General Instruction H (1) (a) and (b) of Form 10-Q and is therefore filing this Form 10-Q with the reduced disclosure format.
The following terms and abbreviations appear in the text of this report and have the definitions described below:
AFUDC
Allowance for Funds Used During Construction
ASC
Accounting Standards Codification
ASU
Accounting Standards Update issued by the FASB
BHC
Black Hills Corporation; the Parent Company
Black Hills Energy
The name used to conduct the business of BHC utility companies
Black Hills Service Company
Black Hills Service Company, LLC, a direct, wholly-owned subsidiary of BHC
Cheyenne Light
Cheyenne Light, Fuel and Power Company, a direct, wholly-owned subsidiary of Black Hills Corporation (doing business as Black Hills Energy)
Cooling degree day (CDD)
A cooling degree day is equivalent to each degree that the average of the high and low temperature for a day is above 65 degrees. The warmer the climate, the greater the number of cooling degree days. Cooling degree days are used in the utility industry to measure the relative warmth of weather and to compare relative temperatures between one geographic area and another. Normal degree days are based on the National Weather Service data for selected locations.
FASB
Financial Accounting Standards Board
FERC
United States Federal Energy Regulatory Commission
Fitch
Fitch Ratings
GAAP
Accounting principles generally accepted in the United States of America
Happy Jack
Happy Jack Wind Farms, LLC, a subsidiary of Duke Energy Generation Services
Heating degree day (HDD)
A heating degree day is equivalent to each degree that the average of the high and the low temperatures for a day is below 65 degrees. The colder the climate, the greater the number of heating degree days. Heating degree days are used in the utility industry to measure the relative coldness of weather and to compare relative temperatures between one geographic area and another. Normal degree days are based on the National Weather Service data for selected locations.
Horizon Point
BHC Corporate headquarters building in Rapid City, South Dakota, which was completed in 2017.
LIBOR
London Interbank Offered Rate
Moody’s
Moody’s Investors Service, Inc.
Parent
Black Hills Corporation
SEC
U. S. Securities and Exchange Commission
Silver Sage
Silver Sage Windpower, LLC, a subsidiary of Duke Energy Generation Services
South Dakota Electric
Includes Black Hills Power operations in South Dakota, Wyoming and Montana
S&P
Standard & Poor’s, a division of The McGraw-Hill Companies, Inc.
TCJA
Tax Cuts and Jobs Act enacted December 22, 2017
WRDC
Wyodak Resources Development Corp., an indirect, wholly-owned subsidiary of BHC
3
BLACK HILLS POWER, INC.
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
Three Months Ended March 31,
(unaudited)
2019
2018
(in thousands)
Revenue
$
79,041
$
73,815
Operating expenses:
Fuel and purchased power
22,733
22,440
Operations and maintenance
19,557
19,151
Depreciation and amortization
10,077
9,884
Taxes - property
2,032
1,976
Total operating expenses
54,399
53,451
Operating income
24,642
20,364
Other income (expense):
Interest charges -
Interest expense incurred (including amortization of debt issuance costs, premiums, and discounts)
(5,830
)
(5,587
)
Allowance for funds used during construction - borrowed
283
48
Interest income
115
115
Allowance for funds used during construction - equity
—
34
Other income (expense), net
(375
)
(151
)
Total other income (expense), net
(5,807
)
(5,541
)
Income before income taxes
18,835
14,823
Income tax expense
(3,338
)
(3,063
)
Net income
15,497
11,760
Other comprehensive income (loss), net of tax:
Reclassification of net realized (gains) losses on settled/amortized interest rate swaps (net of tax of $0 and $(6), respectively)
—
10
Reclassification adjustment of benefit plan liability - net gain (loss) (net of tax of $(4) and $(9), respectively)
12
17
Other comprehensive income (loss), net of tax
12
27
Comprehensive income
$
15,509
$
11,787
The accompanying Notes to Condensed Financial Statements are an integral part of these Condensed Financial Statements.
4
BLACK HILLS POWER, INC.
CONDENSED BALANCE SHEETS
As of
(unaudited)
March 31, 2019
December 31, 2018
(in thousands)
ASSETS
Current assets:
Cash
$
5
$
112
Accounts receivable, net
28,354
28,431
Accounts receivable from affiliates
9,903
8,119
Materials, supplies and fuel
25,275
24,853
Regulatory assets, current
23,215
19,052
Other current assets
4,692
4,538
Total current assets
91,444
85,105
Investments
4,973
4,889
Property, plant and equipment
1,399,901
1,381,045
Less: accumulated depreciation and amortization
(383,681
)
(376,160
)
Total property, plant and equipment, net
1,016,220
1,004,885
Other assets:
Regulatory assets, non-current
53,141
56,680
Other assets, non-current
24,616
9,729
Total other assets, non-current
77,757
66,409
TOTAL ASSETS
$
1,190,394
$
1,161,288
The accompanying Notes to Condensed Financial Statements are an integral part of these Condensed Financial Statements.
5
BLACK HILLS POWER, INC.
CONDENSED BALANCE SHEETS
(Continued)
As of
(unaudited)
March 31, 2019
December 31, 2018
(in thousands, except share amounts)
LIABILITIES AND STOCKHOLDER’S EQUITY
Current liabilities:
Accounts payable
$
19,434
$
25,122
Accounts payable to affiliates
26,966
25,804
Accrued liabilities
40,428
34,193
Money pool notes payable
33,300
38,690
Regulatory liabilities, current
2,079
2,574
Total current liabilities
122,207
126,383
Long-term debt
340,070
340,035
Deferred credits and other liabilities:
Deferred income tax liabilities, net
116,499
114,009
Regulatory liabilities, non-current
161,714
160,642
Benefit plan liabilities
14,631
14,606
Other deferred credits and other liabilities
15,525
1,368
Total deferred credits and other liabilities
308,369
290,625
Commitments and contingencies (Notes 5, 6 and 9)
Stockholder’s equity:
Common stock $1 par value; 50,000,000 shares authorized; 23,416,396 shares issued
23,416
23,416
Additional paid-in capital
39,575
39,575
Retained earnings
357,636
342,145
Accumulated other comprehensive loss
(879
)
(891
)
Total stockholder’s equity
419,748
404,245
TOTAL LIABILITIES AND STOCKHOLDER’S EQUITY
$
1,190,394
$
1,161,288
The accompanying Notes to Condensed Financial Statements are an integral part of these Condensed Financial Statements.
6
BLACK HILLS POWER, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(unaudited)
Three Months Ended March 31,
2019
2018
(in thousands)
Operating activities:
Net income
$
15,497
$
11,760
Adjustments to reconcile net income to net cash provided by operating activities-
Depreciation and amortization
10,077
9,884
Deferred income tax
1,718
(898
)
Employee benefits
195
380
Other adjustments, net
1,044
1,018
Change in operating assets and liabilities -
Accounts receivable and other current assets
(2,437
)
(2,478
)
Accounts payable and other current liabilities
6,210
3,320
Regulatory assets - current
(1,413
)
1,807
Regulatory liabilities - current
(444
)
3,171
Other operating activities, net
(594
)
35
Net cash provided by (used in) operating activities
29,853
27,999
Investing activities:
Property, plant and equipment additions
(24,386
)
(13,533
)
Proceeds from sale of assets
—
4,994
Other investing activities
(169
)
(3,608
)
Net cash provided by (used in) investing activities
(24,555
)
(12,147
)
Financing activities:
Change in money pool notes payable, net
(5,390
)
(15,856
)
Other financing activities
(15
)
—
Net cash provided by (used in) financing activities
(5,405
)
(15,856
)
Net change in cash
(107
)
(4
)
Cash, beginning of period
112
16
Cash, end of period
$
5
$
12
See Note 8 for supplemental cash flow information.
The accompanying Notes to Condensed Financial Statements are an integral part of these Condensed Financial Statements.
7
BLACK HILLS POWER, INC.
Notes to Condensed Financial Statements
(unaudited)
(Reference is made to Notes to Financial Statements
included in our 2018 Annual Report on Form 10-K)
(1) MANAGEMENT’S STATEMENT
The unaudited condensed financial statements included herein have been prepared by Black Hills Power, Inc. (the “Company,” “we,” “us,” or “our”), pursuant to the rules and regulations of the SEC. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations; however, we believe that the footnotes adequately disclose the information presented. These condensed financial statements should be read in conjunction with the financial statements and the notes thereto, included in our 2018 Annual Report on Form 10-K filed with the SEC.
The information furnished in the accompanying condensed financial statements reflects certain estimates required and all adjustments, including accruals, which are, in the opinion of management, necessary for a fair presentation of the March 31, 2019, December 31, 2018 and March 31, 2018 financial information and are of a normal recurring nature. The results of operations for the three months ended March 31, 2019 and March 31, 2018, and our financial condition as of March 31, 2019 and December 31, 2018 are not necessarily indicative of the results of operations and financial condition to be expected as of or for any other period.
Recently Adopted Accounting Standards
Leases, ASU 2016-02
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations by requiring the recognition of right-of-use assets and lease liabilities on the balance sheet for most leases, whereas previously only financing-type lease liabilities (capital leases) were recognized on the balance sheet. Under the new standard, disclosures are required to meet the objective of enabling users of financial statements to assess the amount, timing and uncertainty of cash flows arising from leases.
We adopted the standard effective January 1, 2019. We elected the option to not recast comparative periods presented with transitioning to the new lease standard and will report these comparative periods as presented under previous lease guidance. In addition, we elected the package of practical expedients permitted under the transition guidance with the new standard, which among other things, allowed us to carry forward the historical lease classification. We also elected the practical expedient related to land easements, allowing us to carry forward our accounting treatment of existing land easement agreements.
Adoption of the new standard resulted in the recording of an operating lease right-of-use asset and an off-setting operating lease obligation liability of $14 million as of January 1, 2019. The lease standard did not materially impact our net earnings and had no impact on cash flows.
8
(2) REVENUE
Revenue Recognition
As of January 1, 2018, we adopted ASU 2014-09, Revenue from Contracts with Customers (Topic 606), and its related amendments (collectively known as ASC 606). Revenue is recognized in an amount that reflects the consideration we expect to receive in exchange for goods or services, when control of the promised goods or services is transferred to our customers. The following table depicts the disaggregation of revenue, from contracts with customers by customer type and timing of revenue recognition for the three months ended March 31, 2019 and 2018. Sales tax and other similar taxes are excluded from revenues.
Three Months Ended March 31, 2019
Three Months Ended March 31, 2018
(in thousands)
Customer types:
Retail
$
53,076
$
50,641
Wholesale
8,343
9,050
Market - off-system sales
4,670
2,275
Transmission/Other
12,831
11,718
Revenue from contracts with customers
78,920
73,684
Other revenues
121
131
Total revenues
$
79,041
$
73,815
Timing of revenue recognition:
Services transferred over time
$
78,920
$
73,684
Revenue from contracts with customers
$
78,920
$
73,684
Contract Balances
The nature of our primary revenue contracts provides an unconditional right to consideration upon service delivery; therefore, no customer contract assets or liabilities exist. The unconditional right to consideration is represented by the balance in our Accounts receivable and is further discussed in Note 3. We do not typically incur costs that would be capitalized, to obtain or fulfill a revenue contract.
(3)
ACCOUNTS RECEIVABLE
Following is a summary of Accounts receivable, net included in the accompanying Condensed Balance Sheets (in thousands) as of:
March 31, 2019
December 31, 2018
Accounts receivable trade
$
18,196
$
16,236
Unbilled revenues
10,356
12,333
Allowance for doubtful accounts
(198
)
(138
)
Accounts receivable, net
$
28,354
$
28,431
9
(4)
REGULATORY ACCOUNTING
Our regulated electric operations are subject to regulation by various state and federal agencies. The accounting policies followed are generally subject to the Uniform System of Accounts of the FERC.
Our regulatory assets and liabilities were as follows (in thousands) as of:
March 31, 2019
December 31, 2018
Regulatory assets:
Loss on reacquired debt (a)
$
1,191
$
1,259
Deferred taxes on AFUDC (b)
5,048
5,020
Employee benefit plans and related deferred taxes (c)
20,085
19,868
Deferred energy and fuel cost adjustments (b)
21,649
20,334
Deferred taxes on flow through accounting (c)
9,045
8,749
Decommissioning costs (a)
7,682
8,196
Vegetation management (a)
9,790
10,366
Other regulatory assets (a)
1,866
1,940
Total regulatory assets
$
76,356
$
75,732
Less current regulatory assets
(23,215
)
(19,052
)
Regulatory assets, non-current
$
53,141
$
56,680
Regulatory liabilities:
Cost of removal for utility plant (a)
$
53,758
$
52,366
Employee benefit plan costs and related deferred taxes (c)
7,518
7,518
Excess deferred income taxes (c)
99,846
100,276
TCJA revenue reserve
2,079
2,523
Other regulatory liabilities (c)
592
533
Total regulatory liabilities
$
163,793
$
163,216
Less current regulatory liabilities
(2,079
)
(2,574
)
Regulatory liabilities, non-current
$
161,714
$
160,642
____________________
(a)
We are allowed a recovery of costs, but we are not allowed a rate of return.
(b)
In addition to recovery of costs, we are allowed a rate of return.
(c)
In addition to recovery or repayment of costs, we are allowed a return on a portion of this amount or a reduction in rate base.
Regulatory Matters
There have been no other significant changes to our Regulatory Matters from those previously disclosed in Note 1 of the Notes to the Financial Statements in our 2018 Annual Report on Form 10-K.
10
(5)
RELATED-PARTY TRANSACTIONS
Dividend to Parent
We recorded non-cash dividends to our Parent of $16 million and decreased the utility Money pool note receivable by $16 million for the three months ended March 31, 2018. We did not record any dividends for the three months ended March 31, 2019.
Receivables and Payables
We have accounts receivable and accounts payable balances related to transactions with other BHC subsidiaries. The balances were as follows (in thousands) as of:
March 31, 2019
December 31, 2018
Accounts receivable from affiliates
$
9,903
$
8,119
Accounts payable to affiliates
$
26,966
$
25,804
Money Pool Notes Receivable and Notes Payable
We participate in the Utility Money Pool Agreement (the Agreement). Under the Agreement, we may borrow from the pool; however the Agreement restricts the pool from loaning funds to BHC or to any of BHC’s non-utility subsidiaries. The Agreement does not restrict us from paying dividends to BHC. Borrowings under the Agreement bear interest at the weighted average daily cost of our parent company’s external borrowings as defined under the Agreement, or if there are no external funds outstanding on that date, then the rate will be the daily one-month LIBOR plus 1.0%. At March 31, 2019, the average cost of borrowing under the Utility Money Pool was 2.88%.
We had the following balances with the Utility Money Pool (in thousands) as of:
March 31, 2019
December 31, 2018
Money pool notes payable
$
33,300
$
38,690
Our net interest income (expense) relating to balances with the Utility Money Pool was as follows (in thousands):
Three Months Ended March 31,
2019
2018
Net interest income (expense)
$
(273
)
$
(36
)
11
Other related party activity was as follows (in thousands):
Three Months Ended March 31,
2019
2018
Revenue:
Energy sold to Cheyenne Light
$
574
$
703
Rent from electric properties
$
896
$
909
Horizon Point shared facility revenues
$
3,007
$
2,769
Fuel and purchased power:
Purchases of coal from WRDC
$
4,657
$
4,067
Purchase of excess energy from Cheyenne Light
$
132
$
86
Purchase of renewable wind energy from Cheyenne Light - Happy Jack
$
535
$
641
Purchase of renewable wind energy from Cheyenne Light - Silver Sage
$
983
$
1,093
Gas transportation service agreement:
Gas transportation service agreement with Cheyenne Light for firm and interruptible gas transportation
$
76
$
96
Corporate support:
Corporate support services and fees from Black Hills Service Company
$
10,191
$
7,606
Horizon Point Agreement
We have a shared facility agreement among South Dakota Electric and Black Hills Service Company where there is a cost allocation for the use of the Horizon Point facility that is owned by South Dakota Electric. This cost allocation includes the recovery of and return on allocable property and recovery of incurred administrative service expenses for the operation and maintenance of the Horizon Point facility.
(6)
EMPLOYEE BENEFIT PLANS
The components of net periodic benefit cost for the Defined Benefit Pension Plan were as follows (in thousands):
Three Months Ended March 31,
2019
2018
Service cost
$
91
$
129
Interest cost
603
548
Expected return on plan assets
(851
)
(886
)
Prior service cost
2
11
Net loss (gain)
305
516
Net periodic benefit cost
$
150
$
318
12
Defined Benefit Postretirement Healthcare Plan
The components of net periodic benefit cost for the Defined Benefit Postretirement Healthcare Plan were as follows (in thousands):
Three Months Ended March 31,
2019
2018
Service cost
$
37
$
48
Interest cost
47
45
Prior service cost (benefit)
(84
)
(84
)
Net periodic benefit cost
$
—
$
9
Supplemental Non-qualified Defined Benefit Plans
The components of net periodic benefit cost for the Supplemental Non-qualified Defined Benefit Plans were as follows (in thousands):
Three Months Ended March 31,
2019
2018
Interest cost
$
29
$
27
Net loss (gain)
16
26
Net periodic benefit cost
$
45
$
53
Contributions
Contributions to the Defined Benefit Pension Plan are cash contributions made directly to the Pension Plan Trust account. Contributions to the Postretirement Healthcare and Supplemental Plans are made in the form of benefit payments. Contributions made for 2019 and anticipated contributions for 2019 and 2020 are as follows (in thousands):
Contributions
Three Months Ended
March 31, 2019
Remaining Anticipated Contributions for 2019
Anticipated Contributions for 2020
Defined Benefit Pension Plan
$
—
$
1,753
$
1,841
Defined Benefit Postretirement Healthcare Plan
$
117
$
349
$
466
Supplemental Non-qualified Defined Benefit Plans
$
58
$
172
$
240
13
(7)
FAIR VALUE OF FINANCIAL INSTRUMENTS
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Accounting guidance on fair value measurements establishes a hierarchy for grouping assets and liabilities, based on significance of inputs. For additional information see Note 1 included in our 2018 Annual Report on Form 10-K filed with the SEC.
The estimated fair values of our financial instruments were as follows (in thousands) as of:
March 31, 2019
December 31, 2018
Carrying Amount
Fair Value
Carrying Amount
Fair Value
Cash (a)
$
5
$
5
$
112
$
112
Long-term debt, including current maturities (b) (c)
$
340,070
$
428,498
$
340,035
$
412,894
_________________
(a)
The cash fair value approximates carrying value and therefore is classified as Level 1 in the fair value hierarchy. We believe that the market risk arising from cash in a bank account is minimal.
(b)
Long-term debt is valued based on observable inputs available either directly or indirectly for similar liabilities in active markets and therefore is classified in Level 2 in the fair value hierarchy.
(c)
Carrying amount of long-term debt is net of deferred financing costs.
(8)
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Three Months Ended March 31,
2019
2018
(in thousands)
Non-cash investing and financing activities -
Property, plant and equipment acquired with accrued liabilities
$
8,633
$
7,556
Non-cash (decrease) to money pool notes receivable, net
$
—
$
(16,000
)
Non-cash dividend to Parent
$
—
$
16,000
Cash (paid) refunded during the period for -
Interest (net of amounts capitalized)
$
(3,345
)
$
(3,088
)
Income taxes, net
$
—
$
—
(9)
COMMITMENTS AND CONTINGENCIES
There have been no significant changes to commitments and contingencies from those previously disclosed in Note 11 of our Notes to the Financial Statements in our 2018 Annual Report on Form 10-K.
(10)
LEASES
We have a ground lease for the Wygen III generating facility with an affiliate and communication tower site and operation center facility leases with third parties. Our leases have remaining terms ranging from less than one year to 31 years.
The components of lease expense were as follows (in thousands):
Income Statement Location
Three Months Ended March 31, 2019
Operating lease cost
Operations and maintenance
$
228
Variable lease cost
Operations and maintenance
43
Total lease cost
$
271
14
Supplemental balance sheet information related to leases was as follows (in thousands):
Balance Sheet Location
As of March 31, 2019
Assets:
Operating lease assets
Other assets, non-current
$
14,316
Total lease assets
$
14,316
Liabilities:
Current:
Operating leases
Accrued liabilities
$
279
Noncurrent:
Operating leases
Other deferred credits and other liabilities
14,054
Total lease liabilities
$
14,333
Supplemental cash flow information related to leases was as follows (in thousands):
Three Months Ended March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases
$
223
Right-of-use assets obtained in exchange for lease obligations:
Operating leases
$
—
As of March 31, 2019
Weighted average remaining lease term (years):
Operating leases
31 years
Weighted average discount rate:
Operating leases
4.4
%
Scheduled maturities of operating lease liabilities for future years were as follows (in thousands):
Total
2019 (a)
$
681
2020
856
2021
855
2022
856
2023
853
Thereafter
21,947
Total lease payments
$
26,048
Less imputed interest
11,715
Present value of lease liabilities
$
14,333
(a)
Includes lease obligations for the remaining nine months of 2019.
15
(11)
EQUITY
A summary of the changes in equity is as follows:
Three Months Ended March 31, 2019
Common Stock
(in thousands except share amounts)
Shares
Value
Additional Paid in Capital
Retained Earnings
AOCI
Total
December 31, 2018
23,416
$
23,416
$
39,575
$
342,145
$
(891
)
$
404,245
Net income (loss) available for common stock
—
—
—
15,497
—
15,497
Other comprehensive income (loss), net of tax
—
—
—
—
12
12
Cumulative effect of ASU 2016-02, Leases implementation
—
—
—
(7
)
—
(7
)
Other adjustments
—
—
—
1
—
1
March 31, 2019
23,416
$
23,416
$
39,575
$
357,636
$
(879
)
$
419,748
Three Months Ended March 31, 2018
Common Stock
(in thousands except share amounts)
Shares
Value
Additional Paid in Capital
Retained Earnings
AOCI
Total
December 31, 2017
23,416
$
23,416
$
39,575
$
332,499
$
(1,258
)
$
394,232
Net income (loss) available for common stock
—
—
—
11,760
—
11,760
Other comprehensive income (loss), net of tax
—
—
—
—
27
27
Non-cash dividend to Parent company
—
—
—
(16,000
)
—
(16,000
)
Other adjustments
—
—
—
1
—
1
March 31, 2018
23,416
$
23,416
$
39,575
$
328,260
$
(1,231
)
$
390,020
ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Amounts are presented on a pre-tax basis unless otherwise indicated.
Minor differences in amounts may result due to rounding.
Significant Events
On April 30, 2019, S&P affirmed South Dakota Electric’s credit rating at A.
During the first quarter, South Dakota Electric continued construction on a $70 million, 175-mile electric transmission line from Stegall, Nebraska to Rapid City, South Dakota. The 94-mile final segment of the transmission line is expected to be completed and placed in service in the fall of 2019.
16
Results of Operations
The following discussion includes financial information prepared in accordance with GAAP, as well as another financial measure, gross margin, that is considered a “non-GAAP financial measure.” Generally, a non-GAAP financial measure is a numerical measure of a company’s financial performance, financial position or cash flows that excludes (or includes) amounts that are included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP. Gross margin (revenue less cost of sales) is a non-GAAP financial measure due to the exclusion of depreciation and amortization from the measure. The presentation of gross margin is intended to supplement investors’ understanding of our operating performance.
Gross margin is calculated as operating revenue less cost of fuel and purchased power. Our gross margin is impacted by the fluctuations in power purchases, natural gas and other fuel supply costs. However, while these fluctuating costs impact gross margin as a percentage of revenue, they only impact total gross margin if the costs cannot be passed through to our customers.
Our gross margin measure may not be comparable to other companies’ gross margin measure. Furthermore, this measure is not intended to replace operating income as determined in accordance with GAAP as an indicator of operating performance.
The following tables provide certain financial information and operating statistics:
Three Months Ended March 31,
2019
2018
Variance
(in thousands)
Revenue
$
79,041
$
73,815
$
5,226
Fuel and purchased power
22,733
22,440
293
Gross margin (non-GAAP)
56,308
51,375
4,933
Operating expenses
31,666
31,011
655
Operating income
24,642
20,364
4,278
Interest income (expense), net
(5,432
)
(5,424
)
(8
)
Other income (expense), net
(375
)
(117
)
(258
)
Income tax expense
(3,338
)
(3,063
)
(275
)
Net income
$
15,497
$
11,760
$
3,737
Three Months Ended March 31, 2019 Compared to Three Months Ended March 31, 2018. Net income was $15 million compared to $12 million for the same period in the prior year primarily due to the following:
Gross marginincreased primarily due to $2.4 million of higher power marketing revenue, customer growth, and favorable weather. A $1.6 million reduction in the purchased power capacity charges and higher rider revenues of $0.9 million, primarily related to transmission investment recovery, comprised the remainder of the increase.
Operating expensesincreased primarily due to higher outside services expenses and higher employee costs driven by labor and benefits partially offset by a decrease in expenses due to generation outage timing.
Interest expense, net, Other income (expense), net, and Income tax expense were all comparable to prior year.
17
Electric Revenue by Customer Type
Three Months Ended March 31,
(in thousands)
2019
Percentage Change
2018
Residential
$
21,190
1%
$
21,061
Commercial
23,144
(2)%
23,544
Industrial
8,357
1%
8,276
Municipal
781
(4)%
811
Total retail revenue
53,472
—%
53,692
Wholesale
8,343
(8)%
9,050
Market - off-system sales (a)
4,670
105%
2,275
Other revenue (b)
12,556
43%
8,798
Total revenue
$
79,041
7%
$
73,815
____________________
(a)
Increase for the three months ended March 31, 2019 was due to higher trading volume opportunities driven by weather and energy prices.
(b)
Increase for the three months ended March 31, 2019 was primarily due to the prior year reserve to revenue to reflect the reduction of the lower federal income tax rate from the TCJA on our existing rate tariffs.
Megawatt Hours Sold by Customer Type
Three Months Ended March 31,
2019
Percentage Change
2018
Residential
169,936
4%
163,113
Commercial
194,794
—%
194,931
Industrial
108,196
4%
104,302
Municipal
7,573
1%
7,503
Total retail quantity sold
480,499
2%
469,849
Wholesale
223,020
(6)%
237,704
Market - off-system sales
99,572
8%
92,102
Total quantity sold
803,091
—%
799,655
Losses and Company use (a)
41,910
47%
28,522
Total energy
845,001
2%
828,177
____________________
(a)
Includes company uses, line losses, and excess exchange production.
18
Megawatt Hours Generated and Purchased
Three Months Ended March 31,
Generated -
2019
Percentage Change
2018
Coal-fired
409,666
3%
399,087
Natural Gas and Oil (a)
47,703
264%
13,107
Total generated
457,369
11%
412,194
Total purchased
387,632
(7)%
415,983
Total generated and purchased
845,001
2%
828,177
____________________
(a) Increase is primarily due to low natural gas prices and the ability to generate at a lower cost than to purchase generation on the open market for the three months ended March 31, 2019.
Power Plant Availability
Three Months Ended March 31,
2019
2018
Coal-fired plants (a)
98.2
%
92.9
%
Other plants (b)
87.3
%
99.4
%
Total availability
92.4
%
96.3
%
____________________
(a)
2018 included planned outages at Neil Simpson II, Wyodak and Wygen II.
(b)
2019 includes a planned outage at Lange CT.
Degree Days
Three Months Ended March 31,
2019
2018
Actual
Variance from Normal
Actual
Variance from Normal
Heating degree days
3,916
22
%
3,699
15
%
Credit Ratings
Credit ratings impact our ability to obtain short and long-term financing, the cost of such financing, and vendor payment terms, including collateral requirements. The following table represents our secured credit rating from each agency’s review which was in effect at March 31, 2019:
Rating Agency
Senior Secured Rating
S&P (a)
A
Moody’s (b)
A1
Fitch (c)
A
__________
(a)
On April 30, 2019, S&P affirmed A rating.
(b)
On December 12, 2018, Moody’s affirmed A1 rating.
(c)
On October 11, 2018, Fitch affirmed A rating.
19
FORWARD-LOOKING INFORMATION
This Quarterly Report on Form 10-Q contains forward-looking statements as defined by the SEC. Forward-looking statements are all statements other than statements of historical fact, including without limitation those statements that are identified by the words “anticipates”, “estimates”, “expects”, “intends”, “plans”, “predicts” and similar expressions, and include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. From time to time, the Company may publish or otherwise make available forward-looking statements of this nature, including statements contained within Item 2 - Management’s Discussion & Analysis of Financial Condition and Results of Operations.
Forward-looking statements involve risks and uncertainties, which could cause actual results or outcomes to differ materially from those expressed. The Company’s expectations, beliefs and projections are expressed in good faith and are believed by the Company to have a reasonable basis, including without limitation, management’s examination of historical operating trends, data contained in the Company’s records and other data available from third parties. Nonetheless, the Company’s expectations, beliefs or projections may not be achieved or accomplished.
Any forward-looking statement contained in this document speaks only as of the date on which the statement is made, and the Company undertakes no obligation to update any forward-looking statement or statements to reflect events or circumstances that occur after the date on which the statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for management to predict all of the factors, nor can it assess the effect of each factor on the Company’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statement. All forward-looking statements, whether written or oral and whether made by or on behalf of the Company, are expressly qualified by the risk factors and cautionary statements described in Item 1A of our 2018 Annual Report on Form 10-K, including statements contained within Item 1A - Risk Factors and Part II, Item 1A of this Quarterly Report on Form 10-Q.
ITEM 4.
CONTROLS AND PROCEDURES
This section should be read in conjunction with Item 9A, “Controls and Procedures” included in our Annual Report on Form 10-K for the year ended December 31, 2018.
Our Chief Executive Officer and Chief Financial Officer evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934) as of March 31, 2019. Based on their evaluation, they have concluded that our disclosure controls and procedures were effective as of March 31, 2019.
Our disclosure controls and procedures are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Security Exchange Act of 1934, as amended, is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
During the quarter ended March 31, 2019, there have been no changes in our internal control over financial reporting that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.
20
BLACK HILLS POWER, INC.
Part II - Other Information
Item 1.
Legal Proceedings
For information regarding legal proceedings, see Note 11 of Notes to Financial Statements in Item 8 of our 2018 Annual Report on Form 10-K and Note 9 of our Notes to Condensed Financial Statements in this Quarterly Report on Form 10-Q, which information from Note 9 is incorporated by reference into this item.
Item 1A.
Risk Factors
There are no material changes to the Risk Factors previously disclosed in Item 1A of Part I in our Annual Report on Form 10-K for the year ended December 31, 2018.
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
Previously filed as part of the filing indicated and incorporated by reference herein.
21
BLACK HILLS POWER, INC.
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
BLACK HILLS POWER, INC.
/S/ LINDEN R. EVANS
Linden R. Evans, Chairman, President
and Chief Executive Officer
/S/ RICHARD W. KINZLEY
Richard W. Kinzley, Senior Vice President
and Chief Financial Officer
Dated: May 3, 2019
22
falsedesktopBKH2019-03-31000001240019000006{"post_metric": "https://q10k.com/post-metric", "tbl_copy_plus_disp": "https://q10k.com/tbl-copy-plus-disp", "tbl_copy_plus_copy": "https://q10k.com/tbl-copy-plus-copy", "tbl_sim": "https://q10k.com/tbl-sim", "search": "https://q10k.com/search"}{"q10k_tbl_0": "x\tQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934\n\tFor the quarterly period ended March 31, 2019\nOR\t\no\tTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934\n\tFor the transition period from __________ to __________.\n\tCommission File Number 1-7978\n", "q10k_tbl_1": "Black Hills Power, Inc.\t\nIncorporated in South Dakota\tIRS Identification Number 46-0111677\n7001 Mount Rushmore Road\t\nRapid City, South Dakota 57702\t\nRegistrant's telephone number (605) 721-1700\t\nFormer name, former address, and former fiscal year if changed since last report\t\nNONE\t\n", "q10k_tbl_2": "\t\tPage\n\tGLOSSARY OF TERMS AND ABBREVIATIONS\t3\nPART 1.\tFINANCIAL INFORMATION\t\nItem 1.\tFinancial Statements\t\n\tCondensed Statements of Comprehensive Income - unaudited\t4\n\tThree Months Ended March 31, 2019 and 2018\t\n\tCondensed Balance Sheets - unaudited\t5\n\tMarch 31, 2019 and December 31, 2018\t\n\tCondensed Statements of Cash Flows - unaudited\t7\n\tThree Months Ended March 31, 2019 and 2018\t\n\tNotes to Condensed Financial Statements - unaudited\t8\nItem 2.\tManagements' Discussion and Analysis of Financial Condition and Results of Operations\t16\nItem 4.\tControls and Procedures\t20\nPART II.\tOTHER INFORMATION\t21\nItem 1.\tLegal Proceedings\t21\nItem 1A.\tRisk Factors\t21\nItem 6.\tExhibits\t21\n\tSignatures\t22\n", "q10k_tbl_3": "\tThree Months Ended March 31,\t\n(unaudited)\t2019\t2018\n\t(in thousands)\t\nRevenue\t79,041\t73,815\nOperating expenses:\t\t\nFuel and purchased power\t22,733\t22,440\nOperations and maintenance\t19,557\t19,151\nDepreciation and amortization\t10,077\t9,884\nTaxes - property\t2,032\t1,976\nTotal operating expenses\t54,399\t53,451\nOperating income\t24,642\t20,364\nOther income (expense):\t\t\nInterest charges -\t\t\nInterest expense incurred (including amortization of debt issuance costs, premiums, and discounts)\t(5,830)\t(5,587)\nAllowance for funds used during construction - borrowed\t283\t48\nInterest income\t115\t115\nAllowance for funds used during construction - equity\t-\t34\nOther income (expense), net\t(375)\t(151)\nTotal other income (expense), net\t(5,807)\t(5,541)\nIncome before income taxes\t18,835\t14,823\nIncome tax expense\t(3,338)\t(3,063)\nNet income\t15,497\t11,760\nOther comprehensive income (loss), net of tax:\t\t\nReclassification of net realized (gains) losses on settled/amortized interest rate swaps (net of tax of $0 and $(6), respectively)\t-\t10\nReclassification adjustment of benefit plan liability - net gain (loss) (net of tax of $(4) and $(9), respectively)\t12\t17\nOther comprehensive income (loss), net of tax\t12\t27\nComprehensive income\t15,509\t11,787\n", "q10k_tbl_4": "\tAs of\t\n(unaudited)\tMarch 31, 2019\tDecember 31, 2018\n\t(in thousands)\t\nASSETS\t\t\nCurrent assets:\t\t\nCash\t5\t112\nAccounts receivable, net\t28,354\t28,431\nAccounts receivable from affiliates\t9,903\t8,119\nMaterials, supplies and fuel\t25,275\t24,853\nRegulatory assets, current\t23,215\t19,052\nOther current assets\t4,692\t4,538\nTotal current assets\t91,444\t85,105\nInvestments\t4,973\t4,889\nProperty, plant and equipment\t1,399,901\t1,381,045\nLess: accumulated depreciation and amortization\t(383,681)\t(376,160)\nTotal property, plant and equipment, net\t1,016,220\t1,004,885\nOther assets:\t\t\nRegulatory assets, non-current\t53,141\t56,680\nOther assets, non-current\t24,616\t9,729\nTotal other assets, non-current\t77,757\t66,409\nTOTAL ASSETS\t1,190,394\t1,161,288\n", "q10k_tbl_5": "\tAs of\t\n(unaudited)\tMarch 31, 2019\tDecember 31, 2018\n\t(in thousands, except share amounts)\t\nLIABILITIES AND STOCKHOLDER'S EQUITY\t\t\nCurrent liabilities:\t\t\nAccounts payable\t19,434\t25,122\nAccounts payable to affiliates\t26,966\t25,804\nAccrued liabilities\t40,428\t34,193\nMoney pool notes payable\t33,300\t38,690\nRegulatory liabilities, current\t2,079\t2,574\nTotal current liabilities\t122,207\t126,383\nLong-term debt\t340,070\t340,035\nDeferred credits and other liabilities:\t\t\nDeferred income tax liabilities, net\t116,499\t114,009\nRegulatory liabilities, non-current\t161,714\t160,642\nBenefit plan liabilities\t14,631\t14,606\nOther deferred credits and other liabilities\t15,525\t1,368\nTotal deferred credits and other liabilities\t308,369\t290,625\nCommitments and contingencies (Notes 5, 6 and 9)\t\t\nStockholder's equity:\t\t\nCommon stock $1 par value; 50,000,000 shares authorized; 23,416,396 shares issued\t23,416\t23,416\nAdditional paid-in capital\t39,575\t39,575\nRetained earnings\t357,636\t342,145\nAccumulated other comprehensive loss\t(879)\t(891)\nTotal stockholder's equity\t419,748\t404,245\nTOTAL LIABILITIES AND STOCKHOLDER'S EQUITY\t1,190,394\t1,161,288\n", "q10k_tbl_6": "(unaudited)\tThree Months Ended March 31,\t\n\t2019\t2018\n\t(in thousands)\t\nOperating activities:\t\t\nNet income\t15,497\t11,760\nAdjustments to reconcile net income to net cash provided by operating activities-\t\t\nDepreciation and amortization\t10,077\t9,884\nDeferred income tax\t1,718\t(898)\nEmployee benefits\t195\t380\nOther adjustments, net\t1,044\t1,018\nChange in operating assets and liabilities -\t\t\nAccounts receivable and other current assets\t(2,437)\t(2,478)\nAccounts payable and other current liabilities\t6,210\t3,320\nRegulatory assets - current\t(1,413)\t1,807\nRegulatory liabilities - current\t(444)\t3,171\nOther operating activities, net\t(594)\t35\nNet cash provided by (used in) operating activities\t29,853\t27,999\nInvesting activities:\t\t\nProperty, plant and equipment additions\t(24,386)\t(13,533)\nProceeds from sale of assets\t-\t4,994\nOther investing activities\t(169)\t(3,608)\nNet cash provided by (used in) investing activities\t(24,555)\t(12,147)\nFinancing activities:\t\t\nChange in money pool notes payable, net\t(5,390)\t(15,856)\nOther financing activities\t(15)\t-\nNet cash provided by (used in) financing activities\t(5,405)\t(15,856)\nNet change in cash\t(107)\t(4)\nCash, beginning of period\t112\t16\nCash, end of period\t5\t12\n", "q10k_tbl_7": "\tThree Months Ended March 31, 2019\tThree Months Ended March 31, 2018\n\t(in thousands)\t\nCustomer types:\t\t\nRetail\t53,076\t50,641\nWholesale\t8,343\t9,050\nMarket - off-system sales\t4,670\t2,275\nTransmission/Other\t12,831\t11,718\nRevenue from contracts with customers\t78,920\t73,684\nOther revenues\t121\t131\nTotal revenues\t79,041\t73,815\nTiming of revenue recognition:\t\t\nServices transferred over time\t78,920\t73,684\nRevenue from contracts with customers\t78,920\t73,684\n", "q10k_tbl_8": "\tMarch 31, 2019\tDecember 31, 2018\nAccounts receivable trade\t18,196\t16,236\nUnbilled revenues\t10,356\t12,333\nAllowance for doubtful accounts\t(198)\t(138)\nAccounts receivable, net\t28,354\t28,431\n", "q10k_tbl_9": "\tMarch 31, 2019\tDecember 31, 2018\nRegulatory assets:\t\t\nLoss on reacquired debt (a)\t1,191\t1,259\nDeferred taxes on AFUDC (b)\t5,048\t5,020\nEmployee benefit plans and related deferred taxes (c)\t20,085\t19,868\nDeferred energy and fuel cost adjustments (b)\t21,649\t20,334\nDeferred taxes on flow through accounting (c)\t9,045\t8,749\nDecommissioning costs (a)\t7,682\t8,196\nVegetation management (a)\t9,790\t10,366\nOther regulatory assets (a)\t1,866\t1,940\nTotal regulatory assets\t76,356\t75,732\nLess current regulatory assets\t(23,215)\t(19,052)\nRegulatory assets, non-current\t53,141\t56,680\n", "q10k_tbl_10": "Regulatory liabilities:\t\t\nCost of removal for utility plant (a)\t53,758\t52,366\nEmployee benefit plan costs and related deferred taxes (c)\t7,518\t7,518\nExcess deferred income taxes (c)\t99,846\t100,276\nTCJA revenue reserve\t2,079\t2,523\nOther regulatory liabilities (c)\t592\t533\nTotal regulatory liabilities\t163,793\t163,216\nLess current regulatory liabilities\t(2,079)\t(2,574)\nRegulatory liabilities, non-current\t161,714\t160,642\n", "q10k_tbl_11": "\tMarch 31, 2019\tDecember 31, 2018\nAccounts receivable from affiliates\t9,903\t8,119\nAccounts payable to affiliates\t26,966\t25,804\n", "q10k_tbl_12": "\tMarch 31, 2019\tDecember 31, 2018\nMoney pool notes payable\t33,300\t38,690\n", "q10k_tbl_13": "\tThree Months Ended March 31,\t\n\t2019\t2018\nRevenue:\t\t\nEnergy sold to Cheyenne Light\t574\t703\nRent from electric properties\t896\t909\nHorizon Point shared facility revenues\t3,007\t2,769\nFuel and purchased power:\t\t\nPurchases of coal from WRDC\t4,657\t4,067\nPurchase of excess energy from Cheyenne Light\t132\t86\nPurchase of renewable wind energy from Cheyenne Light - Happy Jack\t535\t641\nPurchase of renewable wind energy from Cheyenne Light - Silver Sage\t983\t1,093\nGas transportation service agreement:\t\t\nGas transportation service agreement with Cheyenne Light for firm and interruptible gas transportation\t76\t96\nCorporate support:\t\t\nCorporate support services and fees from Black Hills Service Company\t10,191\t7,606\n", "q10k_tbl_14": "\tThree Months Ended March 31,\t\n\t2019\t2018\nService cost\t91\t129\nInterest cost\t603\t548\nExpected return on plan assets\t(851)\t(886)\nPrior service cost\t2\t11\nNet loss (gain)\t305\t516\nNet periodic benefit cost\t150\t318\n", "q10k_tbl_15": "\tThree Months Ended March 31,\t\n\t2019\t2018\nService cost\t37\t48\nInterest cost\t47\t45\nPrior service cost (benefit)\t(84)\t(84)\nNet periodic benefit cost\t-\t9\n", "q10k_tbl_16": "\tThree Months Ended March 31,\t\n\t2019\t2018\nInterest cost\t29\t27\nNet loss (gain)\t16\t26\nNet periodic benefit cost\t45\t53\n", "q10k_tbl_17": "\tContributions Three Months Ended March 31, 2019\tRemaining Anticipated Contributions for 2019\tAnticipated Contributions for 2020\nDefined Benefit Pension Plan\t-\t1,753\t1,841\nDefined Benefit Postretirement Healthcare Plan\t117\t349\t466\nSupplemental Non-qualified Defined Benefit Plans\t58\t172\t240\n", "q10k_tbl_18": "\tMarch 31, 2019\t\tDecember 31, 2018\t\n\tCarrying Amount\tFair Value\tCarrying Amount\tFair Value\nCash (a)\t5\t5\t112\t112\nLong-term debt, including current maturities (b) (c)\t340,070\t428,498\t340,035\t412,894\n", "q10k_tbl_19": "\tThree Months Ended March 31,\t\n\t2019\t2018\n\t(in thousands)\t\nNon-cash investing and financing activities -\t\t\nProperty, plant and equipment acquired with accrued liabilities\t8,633\t7,556\nNon-cash (decrease) to money pool notes receivable, net\t-\t(16,000)\nNon-cash dividend to Parent\t-\t16,000\nCash (paid) refunded during the period for -\t\t\nInterest (net of amounts capitalized)\t(3,345)\t(3,088)\nIncome taxes, net\t-\t-\n", "q10k_tbl_20": "\tBalance Sheet Location As of March 31, 2019\nAssets:\t \nOperating lease assets\tOther assets, non-current $14,316\nTotal lease assets\t $14,316\nLiabilities:\t \nCurrent:\t \nOperating leases\tAccrued liabilities $279\nNoncurrent:\t \nOperating leases\tOther deferred credits and other liabilities 14,054\nTotal lease liabilities\t $14,333\n", "q10k_tbl_21": "\tTotal\n2019 (a)\t681\n2020\t856\n2021\t855\n2022\t856\n2023\t853\nThereafter\t21,947\nTotal lease payments\t26,048\nLess imputed interest\t11,715\nPresent value of lease liabilities\t14,333\n", "q10k_tbl_22": "Three Months Ended March 31, 2019\tCommon Stock\t\t\t\t\t\n(in thousands except share amounts)\tShares\tValue\tAdditional Paid in Capital\tRetained Earnings\tAOCI\tTotal\nDecember 31, 2018\t23,416\t23,416\t39,575\t342,145\t(891)\t404,245\nNet income (loss) available for common stock\t-\t-\t-\t15,497\t-\t15,497\nOther comprehensive income (loss), net of tax\t-\t-\t-\t-\t12\t12\nCumulative effect of ASU 2016-02, Leases implementation\t-\t-\t-\t(7)\t-\t(7)\nOther adjustments\t-\t-\t-\t1\t-\t1\nMarch 31, 2019\t23,416\t23,416\t39,575\t357,636\t(879)\t419,748\n", "q10k_tbl_23": "Three Months Ended March 31, 2018\tCommon Stock\t\t\t\t\t\n(in thousands except share amounts)\tShares\tValue\tAdditional Paid in Capital\tRetained Earnings\tAOCI\tTotal\nDecember 31, 2017\t23,416\t23,416\t39,575\t332,499\t(1,258)\t394,232\nNet income (loss) available for common stock\t-\t-\t-\t11,760\t-\t11,760\nOther comprehensive income (loss), net of tax\t-\t-\t-\t-\t27\t27\nNon-cash dividend to Parent company\t-\t-\t-\t(16,000)\t-\t(16,000)\nOther adjustments\t-\t-\t-\t1\t-\t1\nMarch 31, 2018\t23,416\t23,416\t39,575\t328,260\t(1,231)\t390,020\n", "q10k_tbl_24": "\tThree Months Ended March 31,\t\t\n\t2019\t2018\tVariance\n\t(in thousands)\t\t\nRevenue\t79,041\t73,815\t5,226\nFuel and purchased power\t22,733\t22,440\t293\nGross margin (non-GAAP)\t56,308\t51,375\t4,933\nOperating expenses\t31,666\t31,011\t655\nOperating income\t24,642\t20,364\t4,278\nInterest income (expense), net\t(5,432)\t(5,424)\t(8)\nOther income (expense), net\t(375)\t(117)\t(258)\nIncome tax expense\t(3,338)\t(3,063)\t(275)\nNet income\t15,497\t11,760\t3,737\n", "q10k_tbl_25": "\tElectric Revenue by Customer Type\t\t\n\tThree Months Ended March 31,\t\t\n\t(in thousands)\t\t\n\t2019\tPercentage Change\t2018\nResidential\t21,190\t1%\t21,061\nCommercial\t23,144\t(2)%\t23,544\nIndustrial\t8,357\t1%\t8,276\nMunicipal\t781\t(4)%\t811\nTotal retail revenue\t53,472\t-%\t53,692\nWholesale\t8,343\t(8)%\t9,050\nMarket - off-system sales (a)\t4,670\t105%\t2,275\nOther revenue (b)\t12,556\t43%\t8,798\nTotal revenue\t79,041\t7%\t73,815\n", "q10k_tbl_26": "\tMegawatt Hours Sold by Customer Type\t\t\n\tThree Months Ended March 31,\t\t\n\t2019\tPercentage Change\t2018\nResidential\t169,936\t4%\t163,113\nCommercial\t194,794\t-%\t194,931\nIndustrial\t108,196\t4%\t104,302\nMunicipal\t7,573\t1%\t7,503\nTotal retail quantity sold\t480,499\t2%\t469,849\nWholesale\t223,020\t(6)%\t237,704\nMarket - off-system sales\t99,572\t8%\t92,102\nTotal quantity sold\t803,091\t-%\t799,655\nLosses and Company use (a)\t41,910\t47%\t28,522\nTotal energy\t845,001\t2%\t828,177\n", "q10k_tbl_27": "\tMegawatt Hours Generated and Purchased\t\t\n\tThree Months Ended March 31,\t\t\nGenerated -\t2019\tPercentage Change\t2018\nCoal-fired\t409,666\t3%\t399,087\nNatural Gas and Oil (a)\t47,703\t264%\t13,107\nTotal generated\t457,369\t11%\t412,194\nTotal purchased\t387,632\t(7)%\t415,983\nTotal generated and purchased\t845,001\t2%\t828,177\n", "q10k_tbl_28": "\tPower Plant Availability\t\n\tThree Months Ended March 31,\t\n\t2019\t2018\nCoal-fired plants (a)%\t98.2\t92.9%\nOther plants (b)%\t87.3\t99.4%\nTotal availability%\t92.4\t96.3%\n", "q10k_tbl_29": "\tDegree Days\t\t\t\n\tThree Months Ended March 31,\t\t\t\n\t2019\t\t2018\t\n\tActual\tVariance from Normal\tActual\tVariance from Normal\nHeating degree days\t3,916\t22%\t3,699\t15%\n"}{"bs": "q10k_tbl_5", "is": "q10k_tbl_3", "cf": "q10k_tbl_6"}