Eversource 2013 Annual Report Download - page 50

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received from operating cash flows or with the issuance of new long-term debt, determined considering capital requirements and
maintenance of NU's credit rating and profile. Management expects the future operating cash flows of NU, CL&P, NSTAR Electric,
PSNH and WMECO, along with the access to financial markets, will be sufficient to meet any future operating requirements and capital
investment forecasted opportunities.
On March 15, 2013, NSTAR Electric made its final principal and interest payment on approximately $675 million of RRBs that were
issued in March 2005. On May 1, 2013, PSNH made its final principal and interest payment on approximately $525 million of RRBs
that were issued in April 2001. On June 1, 2013, WMECO made its final principal and interest payment on approximately $155 million
of RRBs that were issued in May 2001. As a result, NSTAR Electric, PSNH and WMECO are no longer recovering any payments from
customers associated with these RRBs, which reduced NSTAR Electric’s, PSNH’s and WMECO’s cash flows provided by operating
activities in 2013, compared with 2012. There was no impact on operating cash flows net of RRB payments.
Cash flows provided by operating activities totaled $1.58 billion in 2013, compared with $1.05 billion in 2012 and $901.1 million in 2011
(all amounts are net of RRB payments, which are included in financing activities on the accompanying statements of cash flows). The
improved operating cash flows were due primarily to the addition of NSTAR, which contributed $138.1 million of operating cash flows
(net of RRB payments) in the first quarter of 2013, a decrease of approximately $100 million in cash disbursements for storm
restoration costs associated primarily with the February 2013 blizzard, as compared to 2012 cash disbursements for storm restoration
costs associated primarily with Tropical Storm Irene and the October 2011 snowstorm, the absence in 2013 of $73 million in 2012 cash
disbursements at CL&P, NSTAR Electric, NSTAR Gas and WMECO related to customer bill credits, and the absence in 2013 of $35
million of merger-related cash payments made in 2012. In addition, operating cash flows benefited from an increase in amortization of
regulatory deferrals primarily attributable to tracking mechanisms where such revenues exceeded costs resulting in a favorable cash
flow impact. Partially offsetting these favorable cash flow impacts was a $62.3 million increase in Pension Plan cash contributions,
increases in coal and fuel inventories, and changes in traditional working capital amounts due primarily to the timing of accounts
receivable and accounts payable. The improved operating cash flows in 2012, compared with 2011, were due primarily to the addition
of NSTAR, partially offset by an increase in storm restoration costs, pension plan cash contributions, customer bill credits, and merger-
related costs.
A summary of our corporate credit ratings and outlooks by Moody's, S&P and Fitch is as follows:
Moody's
S&P
Fitch
Current
Outlook
Current
Outlook
Current
Outlook
NU Parent
Baa1
Stable
A-
Stable
BBB+
Stable
CL&P
Baa1
Stable
A-
Stable
BBB+
Stable
NSTAR Electric
A2
Stable
A-
Stable
A
Stable
PSNH
Baa1
Stable
A-
Stable
BBB+
Stable
WMECO
A3
Stable
A-
Stable
BBB+
Stable
A summary of the current credit ratings and outlooks by Moody's, S&P and Fitch for senior unsecured debt of NU parent, NSTAR
Electric, and WMECO and senior secured debt of CL&P and PSNH is as follows:
Moody's
S&P
Fitch
Current
Outlook
Current
Outlook
Current
Outlook
NU Parent
Baa1
Stable
BBB+
Stable
BBB+
Stable
CL&P
A2
Stable
A
Stable
A
Stable
NSTAR Electric
A2
Stable
A-
Stable
A+
Stable
PSNH
A2
Stable
A
Stable
A
Stable
WMECO
A3
Stable
A-
Stable
A-
Stable
On February 14, 2013, S&P revised its criteria for rating utility first mortgage bonds, resulting in one-level upgrades of CL&P and PSNH
first mortgage bonds by S&P. On January 31, 2014, Moody's upgraded corporate credit and securities ratings of NU, CL&P and PSNH
by one level and WMECO by two-levels.
We paid common dividends of $462.7 million in 2013, compared with $375 million in 2012. The increase was due primarily to the
issuance of approximately 136 million of NU common shares to the NSTAR shareholders on April 10, 2012 as a result of the merger,
and an increase of approximately 7.1 percent in our common dividend paid beginning in March 2013. On February 4, 2014, our Board
of Trustees approved a common dividend payment of $0.3925 per share, payable on March 31, 2014 to shareholders of record as of
March 3, 2014. The dividend represented an increase of 6.8 percent over the dividend paid in December 2013.
CL&P, NSTAR Electric, PSNH, and WMECO paid $152 million, $56 million, $68 million, and $40 million, respectively, in common
dividends to their respective parent company in 2013.
Investments in Property, Plant and Equipment on the accompanying statements of cash flows do not include amounts incurred on
capital projects but not yet paid, cost of removal, AFUDC related to equity funds, and, for certain subsidiaries, the capitalized portions of
pension expense. In 2013, investments for NU, CL&P, NSTAR Electric, PSNH, and WMECO were $1.5 billion, $434.9 million, $476.6
million, $186 million, and $128.8 million, respectively.