Eversource 2014 Annual Report Download - page 42

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Overview
 A summary of our earnings by business, which also reconciles the non-GAAP financial measures of consolidated non-GAAP earnings
and EPS, as well as EPS by business, to the most directly comparable GAAP measures of consolidated Net Income Attributable to Controlling
Interest and diluted EPS, is as follows:
For the Years Ended December 31,
2014 2013
2012
(1)
  Amount Per Share Amount Per Share Amount Per Share
Net Income Attributable to Controlling Interest (GAAP)
$819.5 $2.58 $786.0 $2.49 $525.9 $1.89
Regulated Companies $830.1 $2.61 $774.9 $2.45 $626.0 $2.25
NU Parent and Other Companies
11.5 0.04 24.9 0.08 7.5 0.03
Non
-GAAP Earnings 841.6 2.65 799.8 2.53 633.5 2.28
Integration and Merger-Related Costs (after-tax) (22.1) (0.07) (13.8) (0.04) (107.6) (0.39)
Net Income Attributable to Controlling Interest (GAAP)
$819.5 $2.58 $786.0 $2.49 $525.9 $1.89
(1) Results include the operations of NSTAR beginning April 10, 2012.
Excluding the impact of integration costs, our 2014 earnings increased by $41.8 million, as compared to 2013. The increase was due primarily to
lower operations and maintenance costs that impact earnings, which were primarily driven by lower labor and other employee-related costs,
including approximately $30 million of non-tracked pension costs, and lower storm restoration costs, as well as higher firm natural gas sales volumes
as a result of the colder weather in the first quarter of 2014, as compared to the first quarter of 2013. Partially offsetting this increase was the absence
in 2014 of a favorable impact from the resolution of a state income tax audit in 2013, higher property taxes, higher depreciation expense at our
regulated companies, and lower retail electric sales volumes as a result of cooler summer weather in 2014, as compared to the same period in 2013.
Earnings were also unfavorably impacted by the 2014 after-tax net reserve of $22.4 million related to the 2014 FERC ROE orders, as compared to
the 2013 after-tax reserve of $14.3 million related to the 2013 FERC ALJ initial decision in the FERC base ROE complaints. For further
information, see "FERC Regulatory Issues –FERC Base ROE Complaints" in this '

The 2014 and 2013 integration costs consisted of costs incurred for employee severance in connection with ongoing integration. As of December 31,
2014, NU employed approximately 8,250 employees, compared to 8,700 as of December 31, 2013. In addition, the 2014 integration costs included
costs associated with our rebranding efforts, as well as costs related to facility closures across our service territories.
Our Regulated companies consist of the electric distribution, transmission, and natural gas distribution segments. Generation
activities of PSNH and WMECO are included in our electric distribution segment. A summary of our segment earnings and EPS is as follows:
For the Years Ended December 31,
2014 2013
2012
(1)
 Amount Per Share Amount Per Share Amount Per Share
Net Income
–Regulated Companies (GAAP) $830.1 $2.61 $774.9 $2.45 $572.8 $2.06
Electric Distribution $462.4 $1.45 $427.0 $1.35 $343.4 $1.24
Transmission 295.4 0.93 287.0 0.91 249.7 0.89
Natural Gas Distribution
72.3 0.23 60.9 0.19 32.9 0.12
Net Income
–Regulated Companies (Non-GAAP) 830.1 2.61 774.9 2.45 626.0 2.25
Merger-Related Costs (after-tax) (2) - - --(53.2) (0.19)
Net Income
-Regulated Companies (GAAP) $830.1 $2.61 $774.9 $2.45 $572.8 $2.06
(1) Results include the operations of NSTAR beginning April 10, 2012.
(2) Merger-related costs are attributable to the electric distribution segment ($51.1 million) and the natural gas distribution segment ($2.1 million).
Our electric distribution segment earnings increased $35.4 million in 2014, as compared to 2013, due primarily to lower operations and maintenance
costs that impact earnings, which were primarily driven by lower labor and other employee-related costs, including pension costs, and lower storm
restoration costs. Partially offsetting these favorable earnings impacts, as compared to 2013, were higher property taxes and depreciation expense,
lower retail electric sales volumes as a result of cooler summer weather in 2014, and the absence in 2014 of regulatory interest income on stranded
cost deferrals in 2013.
Our transmission segment earnings increased $8.4 million in 2014, as compared to 2013, due primarily to a decrease in transmission segment state
income tax expense and a higher transmission rate base as a result of an increased investment in our transmission infrastructure. These favorable
impacts were partially offset by the after-tax net reserve of $22.4 million related to the 2014 FERC ROE orders, as compared to the $14.3 million
after-tax reserve related to the 2013 FERC ALJ initial decision in the FERC base ROE complaints.
Our natural gas distribution segment earnings increased $11.4 million in 2014, as compared to 2013, due primarily to higher firm natural gas sales
volumes and peak demand revenues resulting from colder weather in the first quarter of 2014 and additional natural gas heating customers.