Eversource 2002 Annual Report Download - page 62

13. Segment Information
NU is organized between regulated utilities (electric and gas since the
March 1, 2000 acquisition of Yankee) and competitive energy subsidiaries
based on the regulatory environment of each segment. The regulated
utilities segment represents approximately 78 percent, 78 percent, and
85 percent of NU’s total revenues for each of the three years in the
period ended December 31, 2002, respectively, and primarily includes
the operations of CL&P, PSNH and WMECO, whose complete financial
statements are included in NU’s combined report on Form 10-K. The
regulated gas utilities segment includes the operations of Yankee Gas.
The reclassification of trading revenues and expenses, which has been
retroactively applied to 2001, resulted in an increase in these percentages
from amounts reported in prior periods. Regulated utility revenues
from the sale of electricity and natural gas primarily are derived from
residential, commercial and industrial customers and are not dependent
on any single customer.
On January 1, 2000, Select Energy began serving one half of CL&P’s
standard offer load for a four-year period through December 31, 2003,
at fixed prices. Total Select Energy revenues from CL&P for CL&P’s
standard offer load and for other transactions with CL&P, represented
approximately $631 million or 38 percent in 2002, approximately $648
million or 31 percent in 2001 and approximately $652 million or 34
percent in 2000, of total competitive energy subsidiaries’revenues.
Total CL&P purchases from the competitive energy subsidiaries are
eliminated in consolidation. Additionally, Select Energy revenues from
NSTAR represented $277.3 million or 13 percent and $285.1 million
or 15 percent of total competitive energy subsidiaries’revenues for the
years ended December 31, 2001 and 2000, respectively. Beginning in
2002, Select Energy also provided basic generation service in the
New Jersey market. Select Energy revenues related to these contracts
represented $207.4 million or 12 percent of total competitive energy
subsidiaries’ revenues for the year ended December 31, 2002. No other
individual customer represented in excess of 10 percent of the competitive
energy subsidiaries revenues for 2002, 2001 and 2000.
Additionally, WMECO’s purchases from Select Energy represented
approximately $14 million and $4 million of total competitive energy
subsidiaries’ revenues in 2002 and 2001, respectively.
The competitive energy subsidiaries segment includes the operations
of Select Energy, a corporation engaged in the trading, marketing,
transportation, storage, and sale of energy commodities, at wholesale
and retail, in designated geographical areas; NGC, a corporation that
acquires and manages generation facilities; SESI, a provider of energy
management, demand-side management and related consulting services
for commercial, industrial and institutional electric companies and electric
utility companies; NGS, including Woods Electrical, a corporation that
maintains and services fossil or hydroelectric facilities and provides
third-party electrical, mechanical, and engineering contracting services;
HWP, a company engaged in the production of electric power; and
Woods Network and the competitive energy subsidiaries of Yankee.
Other in the following table includes the results for Mode 1, an
investor in fiber-optic communications network, the results of the
nonenergy-related subsidiaries of Yankee and the company’s investment
in Accumentrics Corporation. Interest expense included in Other primarily
relates to the debt of NU parent. Inter-segment eliminations of
revenues and expenses are also included in Other.
60
(Millions of Dollars, except share information) 2002 2001 2000
Income before preferred dividends of subsidiaries $157.7 $273.2 $219.5
Preferred dividends of subsidiaries 5.6 7.3 14.2
Income before cumulative effect of accounting change
and extraordinary loss 152.1 265.9 205.3
Cumulative effect of accounting change, net of tax benefit —(22.4) —
Extraordinary loss, net of tax benefit ——(233.9)
Net income/(loss) $152.1 $243.5 $ (28.6)
Basic EPS common shares outstanding (average) 129,150,549 135,632,126 141,549,860
Dilutive effect of employee stock options 190,811 285,297 417,356
Fully diluted EPS common shares outstanding (average) 129,341,360 135,917,423 141,967,216
Basic earnings/(loss) per common share:
Income before cumulative effect of accounting change
and extraordinary loss $1.18 $1.97 $ 1.45
Cumulative effect of accounting change, net of tax benefit —(0.17) —
Extraordinary loss, net of tax benefit —— (1.65)
Net income/(loss) $1.18 $1.80 $ (0.20)
Fully diluted earnings/(loss) per common share:
Income before cumulative effect of accounting change
and extraordinary loss $1.18 $1.96 $1.45
Cumulative effect of accounting change, net of tax benefit —(0.17) —
Extraordinary loss, net of tax benefit —— (1.65)
Net income/(loss) $1.18 $1.79 $ (0.20)
12. Earnings Per Share
EPS is computed based upon the weighted average number of common
shares outstanding during each year. Diluted EPS is computed on the
basis of the weighted average number of common shares outstanding
plus the potential dilutive effect if certain securities are converted into
common stock. The following table sets forth the components of basic
and diluted EPS.