Company Quick10K Filing
Nisource
Price30.56 EPS1
Shares375 P/E22
MCap11,466 P/FCF9
Net Debt8,828 EBIT917
TEV20,294 TEV/EBIT22
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-03-31 Filed 2020-05-06
10-K 2019-12-31 Filed 2020-02-28
10-Q 2019-09-30 Filed 2019-10-30
10-Q 2019-06-30 Filed 2019-07-31
10-Q 2019-03-31 Filed 2019-05-01
10-K 2018-12-31 Filed 2019-02-20
10-Q 2018-09-30 Filed 2018-11-01
10-Q 2018-06-30 Filed 2018-08-01
S-1 2018-05-11 Public Filing
10-Q 2018-03-31 Filed 2018-05-02
10-K 2017-12-31 Filed 2018-02-20
10-Q 2017-09-30 Filed 2017-11-01
10-Q 2017-06-30 Filed 2017-08-02
10-Q 2017-03-31 Filed 2017-05-03
10-K 2016-12-31 Filed 2017-02-22
10-Q 2016-09-30 Filed 2016-11-01
10-Q 2016-06-30 Filed 2016-08-02
10-Q 2016-03-31 Filed 2016-05-03
10-K 2015-12-31 Filed 2016-02-18
10-Q 2015-09-30 Filed 2015-11-03
10-Q 2015-06-30 Filed 2015-08-03
10-Q 2015-03-31 Filed 2015-04-30
10-K 2014-12-31 Filed 2015-02-18
10-Q 2014-09-30 Filed 2014-10-30
10-Q 2014-06-30 Filed 2014-07-31
10-Q 2014-03-31 Filed 2014-04-30
10-K 2013-12-31 Filed 2014-02-18
10-Q 2013-09-30 Filed 2013-10-31
10-Q 2013-06-30 Filed 2013-07-31
10-Q 2013-03-31 Filed 2013-04-30
10-K 2012-12-31 Filed 2013-02-19
10-Q 2012-09-30 Filed 2012-11-02
10-Q 2012-06-30 Filed 2012-07-31
10-Q 2012-03-31 Filed 2012-05-01
10-K 2011-12-31 Filed 2012-02-24
10-Q 2011-09-30 Filed 2011-10-28
10-Q 2011-06-30 Filed 2011-08-02
10-Q 2011-03-31 Filed 2011-05-03
10-K 2010-12-31 Filed 2011-02-28
10-Q 2010-06-30 Filed 2010-08-03
10-Q 2010-03-31 Filed 2010-05-04
10-K 2009-12-31 Filed 2010-02-26
8-K 2020-07-15 Officers
8-K 2020-07-02 Enter Agreement, Other Events, Exhibits
8-K 2020-05-26
8-K 2020-05-19
8-K 2020-05-19
8-K 2020-05-06
8-K 2020-04-23
8-K 2020-04-08
8-K 2020-04-01
8-K 2020-03-09
8-K 2020-03-06
8-K 2020-02-26
8-K 2020-02-26
8-K 2020-02-26
8-K 2019-11-27
8-K 2019-10-30
8-K 2019-08-12
8-K 2019-07-31
8-K 2019-07-26
8-K 2019-06-05
8-K 2019-05-07
8-K 2019-05-01
8-K 2019-04-17
8-K 2019-03-04
8-K 2019-02-20
8-K 2019-02-20
8-K 2018-12-26
8-K 2018-12-12
8-K 2018-11-30
8-K 2018-11-28
8-K 2018-11-01
8-K 2018-11-01
8-K 2018-10-12
8-K 2018-09-26
8-K 2018-09-05
8-K 2018-08-01
8-K 2018-06-06
8-K 2018-06-04
8-K 2018-05-08
8-K 2018-05-02
8-K 2018-05-02
8-K 2018-05-02
8-K 2018-04-18
8-K 2018-03-26
8-K 2018-02-20
8-K 2018-01-26

NI 10Q Quarterly Report

Part I
Item 1. Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-31.1 ni-ex3112020331.htm
EX-31.2 ni-ex3122020331.htm
EX-32.1 ni-ex3212020331.htm
EX-32.2 ni-ex3222020331.htm

Nisource Earnings 2020-03-31

Balance SheetIncome StatementCash Flow
30241812602012201420172020
Assets, Equity
2.62.01.40.80.2-0.42012201420172020
Rev, G Profit, Net Income
3.41.90.4-1.0-2.5-4.02012201420172020
Ops, Inv, Fin

Document
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2020
or
  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 001-16189
NiSource Inc.
(Exact name of registrant as specified in its charter)
DE
 
35-2108964
(State or other jurisdiction of
incorporation or organization)
 
(I.R.S. Employer
Identification No.)
 
 
 
 
801 East 86th Avenue
 
 
Merrillville,
IN
 
46410
(Address of principal executive offices)
 
(Zip Code)
(877) 647-5990
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class
Trading
Symbol(s)
Name of Each Exchange on Which Registered
Common Stock, par value $0.01 per share
NI
NYSE
Depositary Shares, each representing a 1/1,000th ownership interest in a share of 6.50% Series B
NI PR B
NYSE
Fixed-Rate Reset Cumulative Redeemable Perpetual Preferred Stock, par value $0.01 per share, liquidation preference $25,000 per share and a 1/1,000th ownership interest in a share of Series B-1 Preferred Stock, par value $0.01 per share, liquidation preference $0.01 per share
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 þ    No ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files.)
Yes þ    No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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 þ     Accelerated filer ¨     Emerging growth company      Non-accelerated filer ¨    Smaller reporting company
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.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes     No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: Common Stock, $0.01 Par Value: 382,799,472 shares outstanding at April 29, 2020.



NISOURCE INC.
FORM 10-Q QUARTERLY REPORT
FOR THE QUARTER ENDED MARCH 31, 2020
Table of Contents
 
 
 
 
Page
 
 
 
 
 
 
 
PART I
FINANCIAL INFORMATION
 
 
 
 
 
 
Item 1.
Financial Statements - unaudited
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Item 2.
 
 
 
 
 
Item 3.
 
 
 
 
 
Item 4.
 
 
 
PART II
OTHER INFORMATION
 
 
 
 
 
 
Item 1.
 
 
 
 
 
Item 1A.
 
 
 
 
 
Item 2.
 
 
 
 
 
Item 3.
 
 
 
 
 
Item 4.
 
 
 
 
 
Item 5.
 
 
 
 
 
Item 6.
 
 
 
 

2


DEFINED TERMS

The following is a list of frequently used abbreviations or acronyms that are found in this report:

 
NiSource Subsidiaries, Affiliates and Former Subsidiaries
Columbia of Kentucky
Columbia Gas of Kentucky, Inc.
Columbia of Maryland
Columbia Gas of Maryland, Inc.
Columbia of Massachusetts
Bay State Gas Company
Columbia of Ohio
Columbia Gas of Ohio, Inc.
Columbia of Pennsylvania
Columbia Gas of Pennsylvania, Inc.
Columbia of Virginia
Columbia Gas of Virginia, Inc.
NIPSCO
Northern Indiana Public Service Company LLC
NiSource ("we," "us" or “our”)
NiSource Inc.
 
 
Abbreviations and Other
 
ACE
Affordable Clean Energy
AFUDC
Allowance for funds used during construction
AOCI
Accumulated Other Comprehensive Income (Loss)
ASC
Accounting Standards Codification
ASU
Accounting Standards Update
ATM
At-the-market
BTA
Build-transfer agreement
CARES Act
The Coronavirus Aid, Relief and Economic Security Act provides more than $2 trillion to battle COVID-19 and its economic effects, including various types of economic relief for impacted business and industries.
CCRs
Coal Combustion Residuals
CEP
Capital Expenditure Program
CERCLA
Comprehensive Environmental Response Compensation and Liability Act (also known as Superfund)
COVID-19
Novel Coronavirus 2019
DSIC
Distribution System Improvement Charge

DPU
Department of Public Utilities
ELG
Effluent limitations guidelines
EPA
United States Environmental Protection Agency
EPS
Earnings per share
FAC
Fuel adjustment clause
FASB
Financial Accounting Standards Board
FERC
Federal Energy Regulatory Commission
FMCA
Federally Mandated Cost Adjustment
GAAP
Generally Accepted Accounting Principles
GCA
Gas cost adjustment
GCR
Gas cost recovery
GHG
Greenhouse gases
GSEP
Gas System Enhancement Program
GWh
Gigawatt hours
IRP
Infrastructure Replacement Program
IURC
Indiana Utility Regulatory Commission
LIBOR
London InterBank Offered Rate

3


DEFINED TERMS

MA DOR
Massachusetts Department of Revenue
Massachusetts Business
All of the assets being sold to, and liabilities being assumed by, Eversource pursuant to the Asset Purchase Agreement
MGP
Manufactured Gas Plant
MISO
Midcontinent Independent System Operator
MMDth
Million dekatherms
MW
Megawatts
NTSB
National Transportation Safety Board
NYMEX
New York Mercantile Exchange
OPEB
Other Postretirement Benefits
PHMSA
Pipeline and Hazardous Materials Safety Administration
PPA
Power Purchase Agreement
PTC
Production tax credit
RCRA
Resource Conservation and Recovery Act
RFP
Request for proposals
SAVE
Steps to Advance Virginia's Energy Plan
SEC
Securities and Exchange Commission
SMRP
Safety Modification and Replacement Program
STRIDE
Strategic Infrastructure Development Enhancement
TCJA
An Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018 (commonly known as the Tax Cuts and Jobs Act of 2017)
TDSIC
Transmission, Distribution and Storage System Improvement Charge
Note regarding forward-looking statements
This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Investors and prospective investors should understand that many factors govern whether any forward-looking statement contained herein will be or can be realized. Any one of those factors could cause actual results to differ materially from those projected. These forward-looking statements include, but are not limited to, statements concerning our plans, strategies, objectives, expected performance, expenditures, recovery of expenditures through rates, stated on either a consolidated or segment basis, and any and all underlying assumptions and other statements that are other than statements of historical fact. All forward-looking statements are based on assumptions that management believes to be reasonable; however, there can be no assurance that actual results will not differ materially.
Factors that could cause actual results to differ materially from the projections, forecasts, estimates and expectations discussed in this Quarterly Report on Form 10-Q include among other things, our debt obligations; any changes to our credit rating or the credit rating of certain of our subsidiaries; our ability to execute our growth strategy; changes in general economic, capital and commodity market conditions; pension funding obligations; economic regulation and the impact of regulatory rate reviews; our ability to obtain expected financial or regulatory outcomes; our ability to adapt to, and manage costs related to, advances in technology; any changes in our assumptions regarding the financial implications of the Greater Lawrence Incident; compliance with the agreements entered into with the U.S. Attorney’s Office to settle the U.S. Attorney’s Office’s investigation relating to the Greater Lawrence Incident; the pending sale of the Massachusetts Business, including the terms and closing conditions under the Asset Purchase Agreement; potential incidents and other operating risks associated with our business; continuing and potential future impacts from the COVID-19 pandemic; our ability to obtain sufficient insurance coverage and whether such coverage will protect us against significant losses; the outcome of legal and regulatory proceedings, investigations, incidents, claims and litigation; any damage to our reputation, including in connection with the Greater Lawrence Incident; compliance with applicable laws, regulations and tariffs; compliance with environmental laws and the costs of associated liabilities; fluctuations in demand from residential commercial and industrial customers; economic conditions of certain industries; the success of NIPSCO's electric generation strategy; the price of energy commodities and related transportation costs; the reliability of customers and suppliers to fulfill their payment and contractual obligations; potential impairment of goodwill; changes in taxation and accounting principles; the impact of an aging infrastructure; the impact of climate change; potential cyber-attacks; construction risks and natural gas costs and supply risks; extreme weather conditions; the attraction and retention of a qualified workforce; the ability of our subsidiaries to generate

4


cash; our ability to manage new initiatives and organizational changes; the performance of third-party suppliers and service providers; changes in the method for determining LIBOR and the potential replacement of the LIBOR benchmark interest rate; and other matters in the “Risk Factors” section of this report and our Annual Report on Form 10-K for the fiscal year ended December 31, 2019, as supplemented by the risk factor set forth herein in Part II, Item 1A. Risk Factors, many of which risks are beyond our control. In addition, the relative contributions to profitability by each business segment, and the assumptions underlying the forward-looking statements relating thereto, may change over time.
All forward-looking statements are expressly qualified in their entirety by the foregoing cautionary statements. We undertake no obligation to, and expressly disclaim any such obligation to, update or revise any forward-looking statements to reflect changed assumptions, the occurrence of anticipated or unanticipated events or changes to the future results over time or otherwise, except as required by law.

5


Index
Page


6


PART I

ITEM 1. FINANCIAL STATEMENTS
NiSource Inc.
Condensed Statements of Consolidated Income (unaudited)
  
Three Months Ended
March 31,
(in millions, except per share amounts)
2020
 
2019
Operating Revenues
 
 
Customer revenues
$
1,525.9

 
$
1,834.5

Other revenues
79.6

 
35.3

Total Operating Revenues
1,605.5

 
1,869.8

Operating Expenses
 
 
 
Cost of sales (excluding depreciation and amortization)
462.4

 
680.3

Operation and maintenance
444.6

 
552.4

Depreciation and amortization
184.3

 
175.1

Loss on classification as held for sale
280.2

 

Loss (gain) on sale of fixed assets and impairments, net
(0.1
)
 
0.2

Other taxes
85.9

 
87.6

Total Operating Expenses
1,457.3

 
1,495.6

Operating Income
148.2

 
374.2

Other Income (Deductions)
 
 
 
Interest expense, net
(92.9
)
 
(95.6
)
Other, net
5.4

 
(0.7
)
Total Other Deductions, Net
(87.5
)
 
(96.3
)
Income before Income Taxes
60.7


277.9

Income Taxes
(14.9
)
 
59.0

Net Income
75.6

 
218.9

Preferred dividends
(13.8
)
 
(13.8
)
Net Income Available to Common Shareholders
61.8

 
205.1

Earnings Per Share
 
 
 
Basic Earnings Per Share
$
0.16


$
0.55

Diluted Earnings Per Share
$
0.16

 
$
0.55

Basic Average Common Shares Outstanding
383.1

 
373.4

Diluted Average Common Shares
384.1

 
374.7


The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

7

Table of Contents
ITEM 1. FINANCIAL STATEMENTS (continued)


NiSource Inc.
Condensed Statements of Consolidated Comprehensive Income (Loss) (unaudited)

 
Three Months Ended
March 31,
(in millions, net of taxes)
2020
 
2019
Net Income
$
75.6

 
$
218.9

Other comprehensive income (loss):
 
 
 
 Net unrealized gain (loss) on available-for-sale debt securities(1)
(5.4
)
 
2.8

Net unrealized gain (loss) on cash flow hedges(2)
(133.3
)
 
(19.3
)
Unrecognized pension and OPEB benefit(3)
0.7

 
0.9

Total other comprehensive income (loss)
(138.0
)
 
(15.6
)
Comprehensive Income (Loss)
$
(62.4
)
 
$
203.3


(1) Net unrealized gain (loss) on available-for-sale debt securities, net of $1.4 million tax benefit and $0.7 million tax expense in the first quarter of 2020 and 2019, respectively.
(2) Net unrealized gain (loss) on cash flow hedges, net of $44.1 million and $6.5 million tax benefit in the first quarter of 2020 and 2019, respectively.
(3) Unrecognized pension and OPEB benefit, net of $0.3 million tax benefit and $0.4 million tax expense in the first quarter of 2020 and 2019, respectively.
The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

8

Table of Contents
ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.
Condensed Consolidated Balance Sheets (unaudited)
(in millions)
March 31,
2020
 
December 31,
2019
ASSETS
 
 
 
Property, Plant and Equipment
 
 
 
Utility plant
$
22,862.3

 
$
24,502.6

Accumulated depreciation and amortization
(7,293.7
)
 
(7,609.3
)
Net utility plant
15,568.6

 
16,893.3

Other property, at cost, less accumulated depreciation
18.6

 
18.9

Net Property, Plant and Equipment
15,587.2

 
16,912.2

Investments and Other Assets
 
 
 
Unconsolidated affiliates
1.3

 
1.3

Available-for-sale debt securities (amortized cost of $148.4 and $150.1, allowance for credit losses of $1.2 and $0, respectively)
144.6

 
154.2

Other investments
66.1

 
74.7

Total Investments and Other Assets
212.0

 
230.2

Current Assets
 
 
 
Cash and cash equivalents
203.8

 
139.3

Restricted cash
9.2

 
9.1

Accounts receivable
736.8

 
876.1

Allowance for credit losses
(20.3
)
 
(19.2
)
Accounts receivable, net
716.5

 
856.9

Gas inventory
59.9

 
250.9

Materials and supplies, at average cost
130.9

 
120.2

Electric production fuel, at average cost
63.2

 
53.6

Exchange gas receivable
39.0

 
48.5

Assets held for sale
1,655.8

 

Regulatory assets
164.3

 
225.7

Prepayments and other
182.8

 
149.7

Total Current Assets
3,225.4

 
1,853.9

Other Assets
 
 
 
Regulatory assets
1,922.0

 
2,013.9

Goodwill
1,485.9

 
1,485.9

Deferred charges and other
160.2

 
163.7

Total Other Assets
3,568.1

 
3,663.5

Total Assets
$
22,592.7

 
$
22,659.8

 
The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.
 

9

Table of Contents
ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.
Condensed Consolidated Balance Sheets (unaudited) (continued)
(in millions, except share amounts)
March 31,
2020
 
December 31,
2019
CAPITALIZATION AND LIABILITIES
 
 
 
Capitalization
 
 
 
Stockholders’ Equity
 
 
 
Common stock - $0.01 par value, 600,000,000 shares authorized; 382,694,308 and 382,135,680 shares outstanding, respectively
$
3.8

 
$
3.8

Preferred stock - $0.01 par value, 20,000,000 shares authorized; 440,000 shares outstanding
880.0

 
880.0

Treasury stock
(99.9
)
 
(99.9
)
Additional paid-in capital
6,671.5

 
6,666.2

Retained deficit
(1,483.4
)
 
(1,370.8
)
Accumulated other comprehensive loss
(230.6
)
 
(92.6
)
Total Stockholders’ Equity
5,741.4

 
5,986.7

Long-term debt, excluding amounts due within one year
7,817.9

 
7,856.2

Total Capitalization
13,559.3


13,842.9

Current Liabilities
 
 
 
Current portion of long-term debt
7.9

 
13.4

Short-term borrowings
2,046.4

 
1,773.2

Accounts payable
505.6

 
666.0

Dividends payable - common stock
80.4

 

Dividends payable - preferred stock
19.4

 

Customer deposits and credits
163.2

 
256.4

Taxes accrued
223.8

 
231.6

Interest accrued
95.1

 
99.4

Exchange gas payable
18.5

 
59.7

Regulatory liabilities
177.9

 
160.2

Liabilities held for sale
470.9

 

Legal and environmental
17.5

 
20.1

Accrued compensation and employee benefits
129.4

 
156.3

Claims accrued
24.9

 
165.4

Other accruals
180.9

 
144.1

Total Current Liabilities
4,161.8

 
3,745.8

Other Liabilities
 
 
 
Risk management liabilities
312.1

 
134.0

Deferred income taxes
1,451.3

 
1,485.3

Deferred investment tax credits
9.4

 
9.7

Accrued insurance liabilities
82.4

 
81.5

Accrued liability for postretirement and postemployment benefits
359.4

 
373.2

Regulatory liabilities
2,033.8

 
2,352.0

Asset retirement obligations
435.9

 
416.9

Other noncurrent liabilities
187.3

 
218.5

Total Other Liabilities
4,871.6

 
5,071.1

Commitments and Contingencies (Refer to Note 18, "Other Commitments and Contingencies")

 

Total Capitalization and Liabilities
$
22,592.7

 
$
22,659.8

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

10

Table of Contents
ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.
Condensed Statements of Consolidated Cash Flows (unaudited)

Three Months Ended March 31, (in millions)
2020
 
2019
Operating Activities
 
 
 
Net Income
$
75.6

 
$
218.9

Adjustments to Reconcile Net Income to Net Cash from Operating Activities:
 
 
 
Depreciation and amortization
184.3

 
175.1

Deferred income taxes and investment tax credits
(19.9
)
 
51.6

Loss on classification as held for sale

280.2

 

Other adjustments
7.9

 
6.5

Changes in Assets and Liabilities:
 
 
 
Components of working capital
(147.1
)
 
(27.2
)
Regulatory assets/liabilities
12.9

 
0.4

Deferred charges and other noncurrent assets
(12.1
)
 
(58.3
)
Other noncurrent liabilities
(11.9
)
 
32.1

Net Cash Flows from Operating Activities
369.9

 
399.1

Investing Activities
 
 
 
Capital expenditures
(452.1
)
 
(353.7
)
Cost of removal
(34.5
)
 
(25.3
)
Purchases of available-for-sale securities
(43.5
)
 
(25.7
)
Sales of available-for-sale securities
45.4

 
29.3

Other investing activities
0.1

 

Net Cash Flows used for Investing Activities
(484.6
)
 
(375.4
)
Financing Activities
 
 
 
Repayments of long-term debt and finance lease obligations
(4.1
)
 
(2.3
)
Issuance of short-term debt (maturity > 90 days)
500.0

 

Repayment of short-term debt (maturity > 90 days)

 
(350.0
)
Change in short-term borrowings, net (maturity ≤ 90 days)
(226.8
)
 
452.8

Issuance of common stock, net of issuance costs
3.7

 
3.1

Equity costs, premiums and other debt related costs

(5.1
)
 
(4.0
)
Dividends paid - common stock
(80.3
)
 
(74.5
)
Dividends paid - preferred stock
(8.1
)
 
(9.1
)
Net Cash Flows from Financing Activities
179.3

 
16.0

Change in cash, cash equivalents and restricted cash
64.6

 
39.7

Cash, cash equivalents and restricted cash at beginning of period
148.4

 
121.1

Cash, Cash Equivalents and Restricted Cash at End of Period
$
213.0

 
$
160.8


Supplemental Disclosures of Cash Flow Information
Three Months Ended March 31, (in millions)
2020
 
2019
Non-cash transactions:
 
 
 
Capital expenditures included in current liabilities
$
150.5

 
$
123.7

Dividends declared but not paid
99.8

 
94.0

Assets recorded for asset retirement obligations
$
69.8

 
$
4.8



The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

11

Table of Contents
ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.
Condensed Statements of Consolidated Equity (unaudited)
(in millions)
Common
Stock
 
Preferred Stock(1)
 
Treasury
Stock
 
Additional
Paid-In
Capital
 
Retained
Deficit
 
Accumulated
Other
Comprehensive
Loss
 
Total
Balance as of January 1, 2020
$
3.8

 
$
880.0

 
$
(99.9
)
 
$
6,666.2

 
$
(1,370.8
)
 
$
(92.6
)
 
$
5,986.7

Comprehensive Income:
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income

 

 

 

 
75.6

 

 
75.6

Other comprehensive loss, net of tax

 

 

 

 

 
(138.0
)
 
(138.0
)
Dividends:
 
 
 
 
 
 
 
 
 
 
 
 
 
Common stock ($0.42 per share)

 

 

 

 
(160.7
)
 

 
(160.7
)
Preferred stock (See Note 5)

 

 

 

 
(27.5
)
 

 
(27.5
)
Stock issuances:
 
 
 
 
 
 
 
 
 
 
 
 
 
Employee stock purchase plan

 

 

 
1.3

 

 

 
1.3

Long-term incentive plan

 

 

 
(0.5
)
 

 

 
(0.5
)
401(k) and profit sharing

 

 

 
4.5

 

 

 
4.5

Balance as of March 31, 2020
$
3.8

 
$
880.0

 
$
(99.9
)
 
$
6,671.5

 
$
(1,483.4
)
 
$
(230.6
)
 
$
5,741.4

(1)Series A and Series B shares have an aggregate liquidation preference of $400M and $500M, respectively. See Note 5, "Equity" for additional information.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
(in millions)
Common
Stock
 
Preferred Stock(1)
 
Treasury
Stock
 
Additional
Paid-In
Capital
 
Retained
Deficit
 
Accumulated
Other
Comprehensive
Loss
 
Total
Balance as of January 1, 2019
$
3.8

 
$
880.0

 
$
(99.9
)
 
$
6,403.5

 
$
(1,399.3
)
 
$
(37.2
)
 
$
5,750.9

Comprehensive Income:
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income

 

 

 

 
218.9

 

 
218.9

Other comprehensive loss, net of tax

 

 

 

 

 
(15.6
)
 
(15.6
)
Dividends:
 
 
 
 
 
 
 
 
 
 
 
 
 
Common stock ($0.40 per share)

 

 

 

 
(149.1
)
 

 
(149.1
)
Preferred stock (See Note 5)

 

 

 

 
(28.5
)
 

 
(28.5
)
Stock issuances:
 
 
 
 
 
 
 
 
 
 
 
 
 
Employee stock purchase plan

 

 

 
1.3

 

 

 
1.3

Long-term incentive plan

 

 

 
(2.7
)
 

 

 
(2.7
)
401(k) and profit sharing

 

 

 
4.4

 

 

 
4.4

Balance as of March 31, 2019
$
3.8

 
$
880.0

 
$
(99.9
)
 
$
6,406.5

 
$
(1,358.0
)
 
$
(52.8
)
 
$
5,779.6


(1)Series A and Series B shares have an aggregate liquidation preference of $400M and $500M, respectively. See Note 5, "Equity" for additional information.

12

Table of Contents
ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.
Condensed Statements of Consolidated Equity (unaudited) (continued)
 
Preferred
 
Common
Shares (in thousands)
Shares
 
Shares
 
Treasury
 
Outstanding
Balance as of January 1, 2020
440

 
386,099

 
(3,963
)
 
382,136

Issued:
 
 
 
 
 
 
 
Employee stock purchase plan

 
46

 

 
46

Long-term incentive plan

 
347

 

 
347

401(k) and profit sharing

 
165

 

 
165

Balance as of March 31, 2020
440

 
386,657

 
(3,963
)
 
382,694

 
 
 
 
 
 
 
 
 
Preferred
 
Common
Shares (in thousands)
Shares
 
Shares
 
Treasury
 
Outstanding
Balance as of January 1, 2019
420

 
376,326

 
(3,963
)
 
372,363

Issued:
 
 
 
 
 
 
 
Preferred stock
20

 

 

 

Employee stock purchase plan

 
50

 

 
50

Long-term incentive plan

 
426

 

 
426

401(k) and profit sharing

 
164

 

 
164

Balance as of March 31, 2019
440

 
376,966

 
(3,963
)
 
373,003






13

Table of Contents
ITEM 1. FINANCIAL STATEMENTS (continued)
NiSource Inc.
Notes to Condensed Consolidated Financial Statements (unaudited)

 
1.    Basis of Accounting Presentation
Our accompanying Condensed Consolidated Financial Statements (unaudited) reflect all normal recurring adjustments that are necessary, in the opinion of management, to present fairly the results of operations in accordance with GAAP in the United States of America. The accompanying financial statements contain our accounts and that of our majority-owned or controlled subsidiaries.
The accompanying financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2019. Income for interim periods may not be indicative of results for the calendar year due to weather variations and other factors.
The Condensed Consolidated Financial Statements (unaudited) have been prepared pursuant to the rules and regulations of the SEC. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to those rules and regulations, although we believe that the disclosures made in this Quarterly Report on Form 10-Q are adequate to make the information herein not misleading.

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Table of Contents
ITEM 1. FINANCIAL STATEMENTS (continued)
NiSource Inc.
Notes to Condensed Consolidated Financial Statements (unaudited) (continued)


2.    Recent Accounting Pronouncements

Recently Issued Accounting Pronouncements

We are currently evaluating the impact of certain ASUs on our Condensed Consolidated Financial Statements (unaudited) and Notes to Condensed Consolidated Financial Statements (unaudited), which are described below:
Standard
Description
Effective Date
Effect on the financial statements or other significant matters
ASU 2018-14, Compensation—Retirement Benefits—Defined Benefit Plans—General (Subtopic 715-20): Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans
This pronouncement modifies the disclosure requirements for defined benefit pension or other postretirement benefit plans. The guidance removes disclosures that are no longer considered cost beneficial, clarifies the specific requirements of disclosures and adds disclosure requirements identified as relevant. The modifications affect annual period disclosures and must be applied on a retrospective basis to all periods presented.
Annual periods ending after December 15, 2020. Early adoption is permitted.
We are currently in discussions with our third-party specialist to evaluate the effects of this pronouncement on our Notes to Condensed Consolidated Financial Statements (unaudited). We expect to adopt this ASU on its effective date.

ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes
This pronouncement simplifies the accounting for income taxes by eliminating certain exceptions to the general principles in ASC 740, income taxes. It also improves consistency of application for other areas of the guidance by clarifying and amending existing guidance.
Annual periods beginning after December 15, 2020 Early adoption is permitted.
We are currently evaluating the effects of this pronouncement on our Condensed Consolidated Financial Statements (unaudited) and Notes to Condensed Consolidated Financial Statements (unaudited). The most relevant amendment requires that an entity recognize a franchise tax (or similar tax) that is partially based on income as an income-based tax and account for any incremental amount incurred as a non-income-based tax. For NiSource, these taxes may include franchise taxes based on gross receipts, commercial activity taxes and utilities receipts taxes. We expect to adopt this ASU on its effective date.
ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Statements
This pronouncement provides temporary optional expedients and exceptions for applying GAAP principles to contract modifications and hedging relationships to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates to alternative reference rates.
Upon issuance on March 12, 2020, and will apply though December 31, 2022.
We are currently evaluating the temporary expedients and options available under this guidance, and the effects of this pronouncement on our Condensed Consolidated Financial Statements (unaudited) and Notes to Condensed Consolidated Financial Statements (unaudited). As of March 31, 2020, we have not applied any expedients and options available under this ASU.


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Table of Contents
ITEM 1. FINANCIAL STATEMENTS (continued)
NiSource Inc.
Notes to Condensed Consolidated Financial Statements (unaudited) (continued)


Recently Adopted Accounting Pronouncements
Standard
Adoption
ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments

In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments (ASC 326). ASC 326 revised the GAAP guidance on the impairment of most financial assets and certain other instruments that are not measured at fair value through net income. ASC 326 introduces the current expected credit loss (CECL) model that is based on expected losses for instruments measured at amortized cost rather than incurred losses. It also requires entities to record an allowance for available-for-sale debt securities rather than impair the carrying amount of the securities. Subsequent improvements to the estimated credit losses of available-for-sale debt securities will be recognized immediately in earnings, instead of over-time as they would under historic guidance. In 2019, the FASB issued ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivative and Hedging, and Topic 825, Financial Instruments. This pronouncement clarified and improved certain areas of guidance related to the recently issued standards on credit losses, hedging, and recognition and measurement.
We adopted ASC 326 effective January 1, 2020, using a modified retrospective method. Adoption of this standard did not have material impact on our Condensed Consolidated Financial Statements (unaudited). No adjustments were made to the January 1, 2020 opening balances as a result of this adoption. As required under the modified retrospective method of adoption, results for the reporting periods beginning after January 1, 2020 are presented under ASC 326, while prior period amounts are not adjusted.
See Note 3, "Revenue Recognition," and Note 11, "Fair Value," for our discussion of the implementing these standards.
ASU 2016-13,  Financial Instruments-Credit Losses (Topic 326)


3.    Revenue Recognition
Revenue Disaggregation and Reconciliation. We disaggregate revenue from contracts with customers based upon reportable segment as well as by customer class. As our revenues are primarily earned over a period of time and we do not earn a material amount of revenues at a point in time, revenues are not disaggregated as such below. The Gas Distribution Operations segment provides natural gas service and transportation for residential, commercial and industrial customers in Ohio, Pennsylvania, Virginia, Kentucky, Maryland, Indiana and Massachusetts. The Electric Operations segment provides electric service in 20 counties in the northern part of Indiana.
The tables below reconcile revenue disaggregation by customer class to segment revenue as well as to revenues reflected on the Condensed Statements of Consolidated Income (unaudited) for the three months ended March 31, 2020 and March 31, 2019:
Three Months Ended March 31, 2020 (in millions)
Gas Distribution Operations
 
Electric Operations
 
Corporate and Other
 
Total
Customer Revenues(1)