Public Service Enterprise Group (PEG)
Q4 2011 Earnings Call
February 23, 2012 11:00 am ET
Kathleen A. Lally - Vice President of Investor Relations
Previous Statements by PEG
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Caroline D. Dorsa - Chief Financial Officer and Executive Vice President
Paul B. Fremont - Jefferies & Company, Inc., Research Division
Nathan Judge - Atlantic Equities LLP
Jonathan P. Arnold - Deutsche Bank AG, Research Division
Michael Goldenberg - Luminus Management, LLC
Michael J. Lapides - Goldman Sachs Group Inc., Research Division
Julien Dumoulin-Smith - UBS Investment Bank, Research Division
Ladies and gentlemen, thank you for standing by. My name is Brent and I am your event operator today. I'd like to welcome everyone to today's conference, Public Service Enterprise Group Fourth Quarter 2011 Earnings Conference Call and Webcast. [Operator Instructions] As a reminder, this conference is being recorded, today, Thursday, February 23, 2012, and will be available for telephone replay beginning at 1:00 p.m. Eastern today until 11:30 p.m. Eastern on March 1, 2012. It will also be available as an audio webcast on PSEG's corporate website at www.pseg.com.
I would now like to turn the conference over to Kathleen Lally, please go ahead, ma'am.
Kathleen A. Lally
Thank you, Brent, and good morning, everyone. Thanks for participating this morning in our earnings call. As you are aware, we released our fourth quarter and full year 2011 earnings statements earlier this morning. The release and attachments are posted on our website, which is www.pseg.com, under the Investor section. We also posted a series of slides that detail the operating results by company for the quarter. Our 10-K for the period ended December 31, 2011 is expected to be filed shortly. I will go through the full disclaimer statement or the comments we have on the difference between operating earnings and GAAP results, but I do ask that you read all those comments contained in our slides and on our website.
The disclaimer regarding forward-looking statements details the number of risks and uncertainties that could cause actual results to differ materially from forward-looking statements made therein. And although we may elect to update forward-looking statements from time to time, we specifically disclaim any obligation to do so, even if our estimates change, unless required by applicable securities laws. We also present a commentary with regard to the difference between operating earnings and net income reported in accordance with generally accepted accounting principles in the United States. PSEG believes that the non-GAAP financial measure of operating earnings provides a consistent and comparable measure of performance of metrics to help shareholders understand the trends in our performance.
I am now going to turn the call over to Ralph Izzo, Chairman, President and CEO of Public Service Enterprise Group. Joining Ralph on the call is Caroline Dorsa, Executive Vice President and Chief Financial Officer. At the conclusion of their remarks, there will be time for their questions, and we do ask that you limit yourself to one question and one follow-up. Thanks.
Thank you, Kathleen and thanks everyone for joining us today on this call. Earlier this morning we reported operating earnings for the fourth quarter and full year 2011. Our operating earnings of $0.47 per share in the fourth quarter brought operating earnings for the full year to $2.74 per share at the upper end of our guidance for the year of $2.50 to $2.75 per share and consistent with what we shared with you on our last quarterly call.
Despite challenging conditions, the past year was one of significant accomplishment as we made progress in our investments designed to continually improve New Jersey's energy infrastructure. We received approval to extend and renew the Nuclear Regulatory Commission operating licenses for our Hope Creek and Salem stations. Performance at our new nuclear facilities remained strong. Hope Creek exceeded its best annual generation in 2011 by operating at a 98.7% capacity factor.
Extension of what we call the operating excellence model that has been in place at Power's nuclear fleet has been applied to the operational Power's fossil fleet, which resulted in improved availability and record generation. The availability of 3,200 megawatts of natural gas combined cycle capacity overcame weakness in our coal-fired generation, once again highlighting both the benefits of the fleet's fuel diversity and our efforts to run the fleet with the maximum efficiency.
Our employees performed heroically in responding to 2 of the most devastating storms in PSE&G's history. an accomplishment that was saluted by state and municipal officials, as well as customers, demonstrating what we have seen so many times before, that our people remain the foundation of our success.
In the face of lower natural gas prices, we are not standing still. We made significant progress in our capital programs, investing $2.1 billion in 2011 as we near completion of 400 megawatts of new peaking capacity in New Jersey and Connecticut while major transmission projects that will modernize the Northeast grid remain on track for service in 2014 and 2015.
Our $750 million Susquehanna-Roseland transmission project, which we are building in conjunction with PPL Energy is scheduled to be in-service in June of 2015. Our other major transmission projects, North Central Reliability and Northeast Grid Reliability are undergoing siding approval and is scheduled to be in-service in 2014 and 2015 respectively.