OG&E 2012 Annual Report Download - page 69

Carry Deferred Earliest
Forward Tax Expiration
(In millions) Amount Asset Date
Net operating losses
State operating loss $1,026.8 $÷37.8 2030
Federal operating loss 781.9 273.7 2030
Federal tax credits 75.6 75.6 2029
State tax credits
Oklahoma investment tax credits 100.5 65.3 N/A
Oklahoma capital investment
board credits 7.3 7.3 N/A
Oklahoma zero emission tax credits 16.2 11.1 2020
Under tax law in effect at December 31, 2012, the Company
projected utilization of $711.0 million of tax loss carry forward in 2013
and recorded a current deferred tax asset of $152.4 million. The remain-
ing $159.1 million was recorded as a non-current deferred tax asset for
utilization in periods after 2013. With the passage of the American
Taxpayer Relief Act of 2012 on January 2, 2013, the Company now
expects much lower utilization will result in 2013. The impact of the
new law will be reflected in the Company’s 2013 Consolidated Financial
Statements as a decrease in Current Deferred Tax Assets with a
corresponding increase in Deferred Tax Liabilities related to the net
operating loss.
In January 2013, OG&E learned that a portion of certain Oklahoma
investment tax credits previously recognized but not yet utilized may not
be available for utilization in future years. If management determines
that it is more likely than not that it will be unable to utilize these credits,
OG&E will be required to record a reserve of $7.8 million ($5.1 million
after tax) at such time.
11. Common Equity
Automatic Dividend Reinvestment and Stock Purchase Plan
The Company issued 246,549 shares of common stock under its
Automatic Dividend Reinvestment and Stock Purchase Plan in 2012
and received proceeds of $13.4 million. The Company may, from
time to time, issue additional shares under its Automatic Dividend
Reinvestment and Stock Purchase Plan to fund capital requirements or
working capital needs. At December 31, 2012, there were 2,122,494
shares of unissued common stock reserved for issuance under the
Company’s Automatic Dividend Reinvestment and Stock Purchase Plan.
Earnings Per Share
Basic earnings per share is calculated by dividing net income attributable
to OGE Energy by the weighted average number of the Company’s
common shares outstanding during the period. In the calculation of
diluted earnings per share, weighted average shares outstanding are
increased for additional shares that would be outstanding if potentially
dilutive securities were converted to common stock. Potentially dilutive
securities for the Company consist of performance units. Basic and
diluted earnings per share for the Company were calculated as follows:
(In millions) 2012 2011 2010
Net income attributable to OGE Energy $355.0 $342.9 $295.3
Average common shares outstanding
Basic average common shares outstanding 98.6 97.9 97.3
Effect of dilutive securities:
Contingently issuable shares
(performance units) 0.5 1.3 1.6
Diluted average common
shares outstanding 99.1 99.2 98.9
Basic earnings per average common
share attributable to OGE Energy
common shareholders $÷3.60 $÷3.50 $÷3.03
Diluted earnings per average common
share attributable to OGE Energy
common shareholders $÷3.58 $÷3.45 $÷2.99
Anti-dilutive shares excluded
from earnings per share calculation –––
12. Long-Term Debt
A summary of the Company’s long-term debt is included in the
Consolidated Statements of Capitalization. At December 31, 2012,
the Company was in compliance with all of its debt agreements.
OG&E Industrial Authority Bonds
OG&E has tax-exempt pollution control bonds with optional redemption
provisions that allow the holders to request repayment of the bonds on
any business day. The bonds, which can be tendered at the option of
the holder during the next 12 months, are as follows:
Amount
Series Date Due (In millions)
0.22% – 0.40% Garfield Industrial Authority, January 1, 2025 $÷47.0
0.21% – 0.41% Muskogee Industrial Authority, January 1, 2025 32.4
0.20% – 0.47% Muskogee Industrial Authority, June 1, 2027 56.0
Total (redeemable during next 12 months) $135.4
All of these bonds are subject to an optional tender at the request
of the holders, at 100 percent of the principal amount, together with
accrued and unpaid interest to the date of purchase. The bond holders,
on any business day, can request repayment of the bond by delivering an
irrevocable notice to the tender agent stating the principal amount of the
bond, payment instructions for the purchase price and the business day
the bond is to be purchased. The repayment option may only be exer-
cised by the holder of a bond for the principal amount. When a tender
notice has been received by the trustee, a third party remarketing agent
for the bonds will attempt to remarket any bonds tendered for purchase.
This process occurs once per week. Since the original issuance of these
series of bonds in 1995 and 1997, the remarketing agent has success-
fully remarketed all tendered bonds. If the remarketing agent is unable
to remarket any such bonds, OG&E is obligated to repurchase such
OGE Energy Corp. 67