(Mark One) | |
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
FOR THE FISCAL YEAR ENDED DECEMBER 31, | |
OR | |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
FOR THE TRANSITION PERIOD FROM TO |
Texas | 74-0694415 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
1111 Louisiana Houston, Texas 77002 (Address and zip code of principal executive offices) | (713) 207-1111 (Registrant’s telephone number, including area code) |
Title of each class | Name of each exchange on which registered |
Common Stock, $0.01 par value and associated rights to purchase preferred stock | New York Stock Exchange Chicago Stock Exchange |
Large accelerated filer þ | Accelerated filer o | Non-accelerated filer o | Smaller reporting company o |
(Do not check if a smaller reporting company) |
PART I | |||||
Page | |||||
Item 1. | 1 | ||||
Item 1A. | 25 | ||||
Item 1B. | 35 | ||||
Item 2. | 35 | ||||
Item 3. | 36 | ||||
Item 4. | 36 | ||||
PART II | |||||
Item 5. | Market for Registrants’ Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 37 | |||
Item 6. | 38 | ||||
Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 39 | |||
Item 7A. | 63 | ||||
Item 8. | 66 | ||||
Item 9. | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure | 116 | |||
Item 9A. | 116 | ||||
Item 9B. | 117 | ||||
PART III | |||||
Item 10. | 117 | ||||
Item 11. | 117 | ||||
Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 117 | |||
Item 13. | 117 | ||||
Item 14. | 117 | ||||
PART IV | |||||
Item 15. | |||||
118 |
Residential | Commercial/ Industrial | Total Customers | ||||||||||
Arkansas | 390,668 | 48,033 | 438,701 | |||||||||
Louisiana | 232,135 | 17,347 | 249,482 | |||||||||
Minnesota | 738,868 | 67,489 | 806,357 | |||||||||
Mississippi | 109,608 | 12,683 | 122,291 | |||||||||
Oklahoma | 93,388 | 10,620 | 104,008 | |||||||||
Texas | 1,451,666 | 90,719 | 1,542,385 | |||||||||
Total Gas Operations | 3,016,333 | 246,891 | 3,263,224 |
Business Segment | Number | Number Represented by Unions or Other Collective Bargaining Groups | Number | Number Represented by Unions or Other Collective Bargaining Groups | ||||||||||||
Electric Transmission & Distribution | 2,843 | 1,249 | 2,813 | 1,270 | ||||||||||||
Natural Gas Distribution | 3,618 | 1,384 | 3,586 | 1,362 | ||||||||||||
Competitive Natural Gas Sales and Services | 130 | - | 133 | — | ||||||||||||
Interstate Pipelines | 689 | - | 728 | — | ||||||||||||
Field Services | 241 | - | 278 | — | ||||||||||||
Other Operations | 1,289 | - | 1,305 | — | ||||||||||||
Total | 8,810 | 2,633 | 8,843 | 2,632 |
Name | Age | Title | ||
David M. McClanahan | President and Chief Executive Officer and Director | |||
Scott E. Rozzell | Executive Vice President, General Counsel and Corporate Secretary | |||
Gary L. Whitlock | Executive Vice President and Chief Financial Officer | |||
C. Gregory Harper | Senior Vice President and Group President, CenterPoint Energy Pipelines and Field Services | |||
Thomas R. Standish | Senior Vice President and Group President |
Market Price | Dividend | Dividend | ||||||||||||||||||||||
Declared | Market Price | Declared | ||||||||||||||||||||||
High | Low | Per Share | ||||||||||||||||||||||
2008 | ||||||||||||||||||||||||
First Quarter | $ | 0.1825 | ||||||||||||||||||||||
January 9 | $ | 16.98 | ||||||||||||||||||||||
March 17 | $ | 13.84 | ||||||||||||||||||||||
Second Quarter | $ | 0.1825 | ||||||||||||||||||||||
April 1 | $ | 14.66 | ||||||||||||||||||||||
May 29 | $ | 17.16 | ||||||||||||||||||||||
Third Quarter | $ | 0.1825 | ||||||||||||||||||||||
August 11 | $ | 16.59 | ||||||||||||||||||||||
September 18 | $ | 13.98 | ||||||||||||||||||||||
Fourth Quarter | $ | 0.1825 | ||||||||||||||||||||||
October 1 | $ | 14.40 | ||||||||||||||||||||||
October 10 | $ | 9.08 | ||||||||||||||||||||||
High | Low | Per Share | ||||||||||||||||||||||
2009 | ||||||||||||||||||||||||
First Quarter | $ | 0.19 | $ | 0.19 | ||||||||||||||||||||
February 6 | $ | 14.39 | $ | 14.39 | ||||||||||||||||||||
March 6 | $ | 8.88 | $ | 8.88 | ||||||||||||||||||||
Second Quarter | $ | 0.19 | $ | 0.19 | ||||||||||||||||||||
May 27 | $ | 9.77 | $ | 9.77 | ||||||||||||||||||||
June 29 | $ | 11.24 | $ | 11.24 | ||||||||||||||||||||
Third Quarter | $ | 0.19 | $ | 0.19 | ||||||||||||||||||||
July 9 | $ | 10.78 | $ | 10.78 | ||||||||||||||||||||
August 26 | $ | 12.83 | $ | 12.83 | ||||||||||||||||||||
Fourth Quarter | $ | 0.19 | $ | 0.19 | ||||||||||||||||||||
October 2 | $ | 12.22 | $ | 12.22 | ||||||||||||||||||||
December 28 | $ | 14.81 | $ | 14.81 | ||||||||||||||||||||
2010 | ||||||||||||||||||||||||
First Quarter | $ | 0.195 | ||||||||||||||||||||||
January 20 | $ | 14.86 | ||||||||||||||||||||||
February 26 | $ | 13.38 | ||||||||||||||||||||||
Second Quarter | $ | 0.195 | ||||||||||||||||||||||
April 6 | $ | 14.74 | ||||||||||||||||||||||
June 9 | $ | 12.90 | ||||||||||||||||||||||
Third Quarter | $ | 0.195 | ||||||||||||||||||||||
July 2 | $ | 13.03 | ||||||||||||||||||||||
September 28 | $ | 15.84 | ||||||||||||||||||||||
Fourth Quarter | $ | 0.195 | ||||||||||||||||||||||
November 4 | $ | 16.92 | ||||||||||||||||||||||
November 29 | $ | 15.60 |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||||||||||||||||||
2005(1)(2) | 2006(2) | 2007(2) | 2008(2) | 2009 | 2006(1) | 2007(1) | 2008(1) | 2009 | 2010 | |||||||||||||||||||||||||||||||
(In millions, except per share amounts) | (in millions, except per share amounts) | |||||||||||||||||||||||||||||||||||||||
Revenues | $ | 9,722 | $ | 9,319 | $ | 9,623 | $ | 11,322 | $ | 8,281 | $ | 9,319 | $ | 9,623 | $ | 11,322 | $ | 8,281 | $ | 8,785 | ||||||||||||||||||||
Income from continuing operations before extraordinary item | 220 | 427 | 395 | 446 | 372 | |||||||||||||||||||||||||||||||||||
Discontinued operations, net of tax | (3 | ) | - | - | - | - | ||||||||||||||||||||||||||||||||||
Extraordinary item, net of tax | 30 | - | - | - | - | |||||||||||||||||||||||||||||||||||
Net income | $ | 247 | $ | 427 | $ | 395 | $ | 446 | $ | 372 | $ | 427 | $ | 395 | $ | 446 | $ | 372 | $ | 442 | ||||||||||||||||||||
Basic earnings (loss) per common share: | ||||||||||||||||||||||||||||||||||||||||
Income from continuing operations before extraordinary item | $ | 0.71 | $ | 1.37 | $ | 1.23 | $ | 1.32 | $ | 1.02 | ||||||||||||||||||||||||||||||
Discontinued operations, net of tax | (0.01 | ) | - | - | - | - | ||||||||||||||||||||||||||||||||||
Extraordinary item, net of tax | 0.10 | - | - | - | - | |||||||||||||||||||||||||||||||||||
Basic earnings per common share | $ | 0.80 | $ | 1.37 | $ | 1.23 | $ | 1.32 | $ | 1.02 | $ | 1.37 | $ | 1.23 | $ | 1.32 | $ | 1.02 | $ | 1.08 | ||||||||||||||||||||
Diluted earnings (loss) per common share: | ||||||||||||||||||||||||||||||||||||||||
Income from continuing operations before extraordinary item | $ | 0.66 | $ | 1.31 | $ | 1.15 | $ | 1.30 | $ | 1.01 | ||||||||||||||||||||||||||||||
Discontinued operations, net of tax | (0.01 | ) | - | - | - | - | ||||||||||||||||||||||||||||||||||
Extraordinary item, net of tax | 0.09 | - | - | - | - | |||||||||||||||||||||||||||||||||||
Diluted earnings per common share | $ | 0.74 | $ | 1.31 | $ | 1.15 | $ | 1.30 | $ | 1.01 | $ | 1.31 | $ | 1.15 | $ | 1.30 | $ | 1.01 | $ | 1.07 | ||||||||||||||||||||
Cash dividends declared per common share | $ | 0.40 | $ | 0.60 | $ | 0.68 | $ | 0.73 | $ | 0.76 | $ | 0.60 | $ | 0.68 | $ | 0.73 | $ | 0.76 | $ | 0.78 | ||||||||||||||||||||
Dividend payout ratio from continuing operations | 56 | % | 44 | % | 55 | % | 55 | % | 75 | % | ||||||||||||||||||||||||||||||
Return from continuing operations on average common equity | 18.2 | % | 29.8 | % | 23.4 | % | 23.3 | % | 16.0 | % | ||||||||||||||||||||||||||||||
Ratio of earnings from continuing operations to fixed charges | 1.49 | 1.74 | 1.82 | 2.05 | 1.80 | |||||||||||||||||||||||||||||||||||
Dividend payout ratio | 44 | % | 55 | % | 55 | % | 75 | % | 72 | % | ||||||||||||||||||||||||||||||
Return on average common equity | 29.8 | % | 23.4 | % | 23.3 | % | 16.0 | % | 15.1 | % | ||||||||||||||||||||||||||||||
Ratio of earnings to fixed charges | 1.74 | 1.83 | 2.05 | 1.82 | 2.08 | |||||||||||||||||||||||||||||||||||
At year-end: | ||||||||||||||||||||||||||||||||||||||||
Book value per common share | $ | 4.21 | $ | 4.98 | $ | 5.61 | $ | 5.84 | $ | 6.74 | $ | 4.98 | $ | 5.61 | $ | 5.84 | $ | 6.74 | $ | 7.53 | ||||||||||||||||||||
Market price per common share | 12.85 | 16.58 | 17.13 | 12.62 | 14.51 | 16.58 | 17.13 | 12.62 | 14.51 | 15.72 | ||||||||||||||||||||||||||||||
Market price as a percent of book value | 305 | % | 333 | % | 305 | % | 216 | % | 215 | % | 333 | % | 305 | % | 216 | % | 215 | % | 209 | % | ||||||||||||||||||||
Total assets | $ | 17,116 | $ | 17,633 | $ | 17,872 | $ | 19,676 | $ | 19,773 | $ | 17,633 | $ | 17,872 | $ | 19,676 | $ | 19,773 | $ | 20,111 | ||||||||||||||||||||
Short-term borrowings | - | 187 | 232 | 153 | 55 | 187 | 232 | 153 | 55 | 53 | ||||||||||||||||||||||||||||||
Transition and system restoration bonds, including current maturities | 2,480 | 2,407 | 2,260 | 2,589 | 3,046 | 2,407 | 2,260 | 2,589 | 3,046 | 2,805 | ||||||||||||||||||||||||||||||
Other long-term debt, including current maturities | 6,411 | 6,586 | 7,417 | 7,925 | 6,976 | 6,586 | 7,417 | 7,925 | 6,976 | 6,624 | ||||||||||||||||||||||||||||||
Capitalization: | ||||||||||||||||||||||||||||||||||||||||
Common stock equity | 13 | % | 15 | % | 16 | % | 16 | % | 21 | % | 15 | % | 16 | % | 16 | % | 21 | % | 25 | % | ||||||||||||||||||||
Long-term debt, including current maturities | 87 | % | 85 | % | 84 | % | 84 | % | 79 | % | 85 | % | 84 | % | 84 | % | 79 | % | 75 | % | ||||||||||||||||||||
Capitalization, excluding transition and system restoration bonds: | ||||||||||||||||||||||||||||||||||||||||
Common stock equity | 17 | % | 19 | % | 20 | % | 20 | % | 27 | % | 19 | % | 20 | % | 20 | % | 27 | % | 33 | % | ||||||||||||||||||||
Long-term debt, excluding transition and system restoration bonds, including current maturities | 83 | % | 81 | % | 80 | % | 80 | % | 73 | % | 81 | % | 80 | % | 80 | % | 73 | % | 67 | % | ||||||||||||||||||||
Capital expenditures, excluding discontinued operations | $ | 719 | $ | 1,121 | $ | 1,011 | $ | 1,053 | $ | 1,148 | ||||||||||||||||||||||||||||||
Capital expenditures | $ | 1,121 | $ | 1,011 | $ | 1,053 | $ | 1,148 | $ | 1,462 |
(1) | Net income |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
Revenues | $ | 9,623 | $ | 11,322 | $ | 8,281 | $ | 11,322 | $ | 8,281 | $ | 8,785 | ||||||||||||
Expenses | 8,438 | 10,049 | 7,157 | 10,049 | 7,157 | 7,536 | ||||||||||||||||||
Operating Income | 1,185 | 1,273 | 1,124 | 1,273 | 1,124 | 1,249 | ||||||||||||||||||
Gain (Loss) on Marketable Securities | (114 | ) | (139 | ) | 82 | (139 | ) | 82 | 67 | |||||||||||||||
Gain (Loss) on Indexed Debt Securities | 111 | 128 | (68 | ) | 128 | (68 | ) | (31 | ) | |||||||||||||||
Interest and Other Finance Charges | (509 | ) | (468 | ) | (513 | ) | (468 | ) | (513 | ) | (481 | ) | ||||||||||||
Interest on Transition and System Restoration Bonds | (123 | ) | (136 | ) | (131 | ) | (136 | ) | (131 | ) | (140 | ) | ||||||||||||
Distribution from AOL Time Warner Litigation Settlement | 32 | - | 3 | |||||||||||||||||||||
Additional Distribution to ZENS Holders | (27 | ) | - | (3 | ) | |||||||||||||||||||
Equity in Earnings of Unconsolidated Affiliates | 16 | 51 | 15 | 51 | 15 | 29 | ||||||||||||||||||
Other Income, net | 17 | 14 | 39 | 14 | 39 | 12 | ||||||||||||||||||
Income Before Income Taxes | 588 | 723 | 548 | 723 | 548 | 705 | ||||||||||||||||||
Income Tax Expense | (193 | ) | (277 | ) | (176 | ) | (277 | ) | (176 | ) | (263 | ) | ||||||||||||
Net Income | $ | 395 | $ | 446 | $ | 372 | $ | 446 | $ | 372 | $ | 442 | ||||||||||||
Basic Earnings Per Share | $ | 1.23 | $ | 1.32 | $ | 1.02 | $ | 1.32 | $ | 1.02 | $ | 1.08 | ||||||||||||
Diluted Earnings Per Share | $ | 1.15 | $ | 1.30 | $ | 1.01 | $ | 1.30 | $ | 1.01 | $ | 1.07 |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
Electric Transmission & Distribution | $ | 561 | $ | 545 | $ | 545 | $ | 545 | $ | 545 | $ | 567 | ||||||||||||
Natural Gas Distribution | 218 | 215 | 204 | 215 | 204 | 231 | ||||||||||||||||||
Competitive Natural Gas Sales and Services | 75 | 62 | 21 | 62 | 21 | 16 | ||||||||||||||||||
Interstate Pipelines | 237 | 293 | 256 | 293 | 256 | 270 | ||||||||||||||||||
Field Services | 99 | 147 | 94 | 147 | 94 | 151 | ||||||||||||||||||
Other Operations | (5 | ) | 11 | 4 | 11 | 4 | 14 | |||||||||||||||||
Total Consolidated Operating Income | $ | 1,185 | $ | 1,273 | $ | 1,124 | $ | 1,273 | $ | 1,124 | $ | 1,249 |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Electric transmission and distribution utility | $ | 1,560 | $ | 1,593 | $ | 1,673 | $ | 1,593 | $ | 1,673 | $ | 1,768 | ||||||||||||
Transition and system restoration bond companies | 277 | 323 | 340 | 323 | 340 | 437 | ||||||||||||||||||
Total revenues | 1,837 | 1,916 | 2,013 | 1,916 | 2,013 | 2,205 | ||||||||||||||||||
Expenses: | ||||||||||||||||||||||||
Operation and maintenance, excluding transition and system restoration bond companies | 652 | 703 | 774 | 703 | 774 | 841 | ||||||||||||||||||
Depreciation and amortization, excluding transition and system restoration bond companies | 243 | 277 | 277 | 277 | 277 | 293 | ||||||||||||||||||
Taxes other than income taxes | 223 | 201 | 208 | 201 | 208 | 207 | ||||||||||||||||||
Transition and system restoration bond companies | 158 | 190 | 209 | 190 | 209 | 297 | ||||||||||||||||||
Total expenses | 1,276 | 1,371 | 1,468 | 1,371 | 1,468 | 1,638 | ||||||||||||||||||
Operating Income | $ | 561 | $ | 545 | $ | 545 | $ | 545 | $ | 545 | $ | 567 | ||||||||||||
Operating Income: | ||||||||||||||||||||||||
Electric transmission and distribution operations | $ | 400 | $ | 407 | $ | 414 | $ | 407 | $ | 414 | $ | 427 | ||||||||||||
Competition transition charge | 42 | 5 | - | 5 | — | — | ||||||||||||||||||
Transition and system restoration bond companies (1) | 119 | 133 | 131 | 133 | 131 | 140 | ||||||||||||||||||
Total segment operating income | $ | 561 | $ | 545 | $ | 545 | $ | 545 | $ | 545 | $ | 567 | ||||||||||||
Throughput (in gigawatt-hours (GWh)): | ||||||||||||||||||||||||
Residential | 23,999 | 24,258 | 24,815 | 24,258 | 24,815 | 26,554 | ||||||||||||||||||
Total | 76,291 | 74,840 | 74,579 | 74,840 | 74,579 | 76,973 | ||||||||||||||||||
Number of metered customers at end of period: | ||||||||||||||||||||||||
Residential | 1,793,600 | 1,821,267 | 1,849,019 | 1,821,267 | 1,849,019 | 1,874,508 | ||||||||||||||||||
Total | 2,034,074 | 2,064,854 | 2,094,210 | 2,064,854 | 2,094,210 | 2,122,135 |
(1) | Represents the amount necessary to pay interest on the transition and system restoration bonds. |
Year Ended December 31, | ||||||||||||
2007 | 2008 | 2009 | ||||||||||
Revenues | $ | 3,759 | $ | 4,226 | $ | 3,384 | ||||||
Expenses: | ||||||||||||
Natural gas | 2,683 | 3,124 | 2,251 | |||||||||
Operation and maintenance | 579 | 589 | 639 | |||||||||
Depreciation and amortization | 155 | 157 | 161 | |||||||||
Taxes other than income taxes | 124 | 141 | 129 | |||||||||
Total expenses | 3,541 | 4,011 | 3,180 | |||||||||
Operating Income | $ | 218 | $ | 215 | $ | 204 | ||||||
Throughput (in Bcf): | ||||||||||||
Residential | 172 | 175 | 173 | |||||||||
Commercial and industrial | 232 | 236 | 233 | |||||||||
Total Throughput | 404 | 411 | 406 | |||||||||
Number of customers at end of period: | ||||||||||||
Residential | 2,961,110 | 2,987,222 | 3,002,114 | |||||||||
Commercial and industrial | 249,877 | 248,476 | 244,101 | |||||||||
Total | 3,210,987 | 3,235,698 | 3,246,215 |
Year Ended December 31, | ||||||||||||
2008 | 2009 | 2010 | ||||||||||
Revenues | $ | 4,226 | $ | 3,384 | $ | 3,213 | ||||||
Expenses: | ||||||||||||
Natural gas | 3,124 | 2,251 | 2,049 | |||||||||
Operation and maintenance | 589 | 639 | 639 | |||||||||
Depreciation and amortization | 157 | 161 | 166 | |||||||||
Taxes other than income taxes | 141 | 129 | 128 | |||||||||
Total expenses | 4,011 | 3,180 | 2,982 | |||||||||
Operating Income | $ | 215 | $ | 204 | $ | 231 | ||||||
Throughput (in Bcf): | ||||||||||||
Residential | 175 | 173 | 177 | |||||||||
Commercial and industrial | 236 | 233 | 249 | |||||||||
Total Throughput | 411 | 406 | 426 | |||||||||
Number of customers at end of period: | ||||||||||||
Residential | 2,987,222 | 3,002,114 | 3,016,333 | |||||||||
Commercial and industrial | 248,476 | 244,101 | 246,891 | |||||||||
Total | 3,235,698 | 3,246,215 | 3,263,224 |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
Revenues | $ | 3,579 | $ | 4,528 | $ | 2,230 | $ | 4,528 | $ | 2,230 | $ | 2,651 | ||||||||||||
Expenses: | ||||||||||||||||||||||||
Natural gas | 3,467 | 4,423 | 2,165 | 4,423 | 2,165 | 2,591 | ||||||||||||||||||
Operation and maintenance | 31 | 39 | 39 | 39 | 39 | 38 | ||||||||||||||||||
Depreciation and amortization | 5 | 3 | 4 | 3 | 4 | 4 | ||||||||||||||||||
Taxes other than income taxes | 1 | 1 | 1 | 1 | 1 | 2 | ||||||||||||||||||
Total expenses | 3,504 | 4,466 | 2,209 | 4,466 | 2,209 | 2,635 | ||||||||||||||||||
Operating Income | $ | 75 | $ | 62 | $ | 21 | $ | 62 | $ | 21 | $ | 16 | ||||||||||||
Throughput (in Bcf) | 522 | 528 | 504 | 528 | 504 | 548 | ||||||||||||||||||
Number of customers at end of period | 7,139 | 9,771 | 11,168 | 9,771 | 11,168 | 12,193 |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
Revenues | $ | 500 | $ | 650 | $ | 598 | $ | 650 | $ | 598 | $ | 601 | ||||||||||||
Expenses: | ||||||||||||||||||||||||
Natural gas | 83 | 155 | 97 | 155 | 97 | 93 | ||||||||||||||||||
Operation and maintenance | 125 | 133 | 166 | 133 | 166 | 153 | ||||||||||||||||||
Depreciation and amortization | 44 | 46 | 48 | 46 | 48 | 52 | ||||||||||||||||||
Taxes other than income taxes | 11 | 23 | 31 | 23 | 31 | 33 | ||||||||||||||||||
Total expenses | 263 | 357 | 342 | 357 | 342 | 331 | ||||||||||||||||||
Operating Income | $ | 237 | $ | 293 | $ | 256 | $ | 293 | $ | 256 | $ | 270 | ||||||||||||
Equity in earnings of unconsolidated affiliates | $ | 36 | $ | 7 | $ | 19 | ||||||||||||||||||
Transportation throughput (in Bcf) | 1,216 | 1,538 | 1,592 | 1,538 | 1,592 | 1,693 |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
Revenues | $ | 175 | $ | 252 | $ | 241 | $ | 252 | $ | 241 | $ | 338 | ||||||||||||
Expenses: | ||||||||||||||||||||||||
Natural gas | (4 | ) | 21 | 51 | 21 | 51 | 72 | |||||||||||||||||
Operation and maintenance | 66 | 69 | 77 | 69 | 77 | 85 | ||||||||||||||||||
Depreciation and amortization | 11 | 12 | 15 | 12 | 15 | 25 | ||||||||||||||||||
Taxes other than income taxes | 3 | 3 | 4 | 3 | 4 | 5 | ||||||||||||||||||
Total expenses | 76 | 105 | 147 | 105 | 147 | 187 | ||||||||||||||||||
Operating Income | $ | 99 | $ | 147 | $ | 94 | $ | 147 | $ | 94 | $ | 151 | ||||||||||||
Equity in earnings of unconsolidated affiliates | $ | 15 | $ | 8 | $ | 10 | ||||||||||||||||||
Gathering throughput (in Bcf) | 398 | 421 | 426 | 421 | 426 | 650 |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
Revenues | $ | 10 | $ | 11 | $ | 11 | $ | 11 | $ | 11 | $ | 11 | ||||||||||||
Expenses | 15 | – | 7 | – | 7 | (3 | ) | |||||||||||||||||
Operating Income (Loss) | $ | (5 | ) | $ | 11 | $ | 4 | |||||||||||||||||
Operating Income | $ | 11 | $ | 4 | $ | 14 |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
Cash provided by (used in): | ||||||||||||||||||||||||
Operating activities | $ | 774 | $ | 851 | $ | 1,841 | $ | 851 | $ | 1,841 | $ | 1,386 | ||||||||||||
Investing activities | (1,300 | ) | (1,368 | ) | (896 | ) | (1,368 | ) | (896 | ) | (1,420 | ) | ||||||||||||
Financing activities | 528 | 555 | (372 | ) | 555 | (372 | ) | (507 | ) |
2009 | 2010 | 2011 | 2012 | 2013 | 2014 | |||||||||||||||||||
Electric Transmission & Distribution (1) | $ | 428 | $ | 557 | $ | 563 | $ | 488 | $ | 503 | $ | 484 | ||||||||||||
Natural Gas Distribution | 165 | 210 | 237 | 241 | 259 | 248 | ||||||||||||||||||
Competitive Natural Gas Sales and Services | 2 | 6 | 4 | 16 | 5 | 5 | ||||||||||||||||||
Interstate Pipelines | 176 | 171 | 192 | 245 | 164 | 94 | ||||||||||||||||||
Field Services | 348 | 226 | 163 | 126 | 95 | 85 | ||||||||||||||||||
Other Operations | 29 | 38 | 59 | 40 | 30 | 30 | ||||||||||||||||||
Total | $ | 1,148 | $ | 1,208 | $ | 1,218 | $ | 1,156 | $ | 1,056 | $ | 946 |
2010 | 2011 | 2012 | 2013 | 2014 | 2015 | |||||||||||||||||||
Electric Transmission & Distribution (1) | $ | 463 | $ | 605 | $ | 468 | $ | 469 | $ | 506 | $ | 372 | ||||||||||||
Natural Gas Distribution | 202 | 263 | 274 | 285 | 285 | 285 | ||||||||||||||||||
Competitive Natural Gas Sales and Services | 2 | 10 | 12 | 12 | 6 | 6 | ||||||||||||||||||
Interstate Pipelines | 102 | 157 | 133 | 131 | 119 | 95 | ||||||||||||||||||
Field Services | 668 | 262 | 135 | 125 | 59 | 60 | ||||||||||||||||||
Other Operations | 25 | 40 | 31 | 25 | 25 | 27 | ||||||||||||||||||
Total | $ | 1,462 | $ | 1,337 | $ | 1,053 | $ | 1,047 | $ | 1,000 | $ | 845 |
(1) | Includes capital expenditures of |
Contractual Obligations | Total | 2011 | 2012-2013 | 2014-2015 | 2016 and thereafter | |||||||||||||||
Transition and system restoration bond debt | $ | 2,805 | $ | 283 | $ | 637 | $ | 484 | $ | 1,401 | ||||||||||
Other long-term debt(1) | 7,303 | 19 | 1,044 | 1,380 | 4,860 | |||||||||||||||
Interest payments — transition and system restoration bond debt(2) | 699 | 129 | 217 | 162 | 191 | |||||||||||||||
Interest payments — other long-term debt(2) | 4,195 | 426 | 790 | 562 | 2,417 | |||||||||||||||
Short-term borrowings | 53 | 53 | — | — | — | |||||||||||||||
Capital leases | 1 | — | — | — | 1 | |||||||||||||||
Operating leases(3) | 59 | 15 | 19 | 10 | 15 | |||||||||||||||
Benefit obligations(4) | — | — | — | — | — | |||||||||||||||
Purchase obligations(5) | 1 | 1 | — | — | — | |||||||||||||||
Non-trading derivative liabilities | 85 | 69 | 16 | — | — | |||||||||||||||
Other commodity commitments(6) | 2,393 | 502 | 933 | 505 | 453 | |||||||||||||||
Income taxes(7) | — | — | — | — | — | |||||||||||||||
Other | 18 | 6 | 12 | — | — | |||||||||||||||
Total contractual cash obligations | $ | 17,612 | $ | 1,503 | $ | 3,668 | $ | 3,103 | $ | 9,338 |
Contractual Obligations | Total | 2010 | 2011-2012 | 2013-2014 | 2015 and thereafter | |||||||||||||||
Transition and system restoration bond debt | $ | 3,046 | $ | 241 | $ | 590 | $ | 565 | $ | 1,650 | ||||||||||
Other long-term debt(1) | 7,668 | 541 | 615 | 2,171 | 4,341 | |||||||||||||||
Interest payments - transition and system restoration bond debt(2) | 834 | 135 | 245 | 187 | 267 | |||||||||||||||
Interest payments - other long-term debt(2) | 3,919 | 433 | 791 | 608 | 2,087 | |||||||||||||||
Short-term borrowings | 55 | 55 | - | - | - | |||||||||||||||
Capital leases | 1 | - | - | - | 1 | |||||||||||||||
Operating leases(3) | 51 | 12 | 22 | 10 | 7 | |||||||||||||||
Benefit obligations(4) | - | - | - | - | - | |||||||||||||||
Purchase obligations(5) | 9 | 9 | - | - | - | |||||||||||||||
Non-trading derivative liabilities | 93 | 51 | 42 | - | - | |||||||||||||||
Other commodity commitments(6) | 2,558 | 439 | 917 | 659 | 543 | |||||||||||||||
Income taxes(7) | - | - | - | - | - | |||||||||||||||
Other | 25 | 7 | 12 | 6 | - | |||||||||||||||
Total contractual cash obligations | $ | 18,259 | $ | 1,923 | $ | 3,234 | $ | 4,206 | $ | 8,896 |
(1) |
(2) | We calculated estimated interest payments for long-term debt as follows: for fixed-rate debt and term debt, we calculated interest based on the applicable rates and payment dates; for variable-rate debt and/or non-term debt, we used interest rates in place as of December 31, |
(3) | For a discussion of operating leases, please read Note |
(4) |
(5) | Represents capital commitments for material in connection with our Interstate Pipelines business segment. |
(6) | For a discussion of other commodity commitments, please read Note |
(7) | As of December 31, |
Date Executed | Company | Type of Facility | Size of Facility | Amount Utilized at February 15, 2010 (1) | Termination Date | ||||||||
June 29, 2007 | CenterPoint Energy | Revolver | $ | 1,156 | $ | 20 | (2) | June 29, 2012 | |||||
June 29, 2007 | CenterPoint Houston | Revolver | 289 | 4 | (2) | June 29, 2012 | |||||||
June 29, 2007 | CERC Corp. | Revolver | 915 | - | June 29, 2012 | ||||||||
October 9, 2009 | CERC | Receivables | 375 | - | October 8, 2010 |
Date Executed | Company | Type of Facility | Size of Facility | Amount Utilized at February 15, 2011 (1) | Termination Date | ||||||||
June 29, 2007 | CenterPoint Energy | Revolver | $ | 1,156 | $ | 20 | (2) | June 29, 2012 | |||||
June 29, 2007 | CenterPoint Houston | Revolver | 289 | 4 | (2) | June 29, 2012 | |||||||
June 29, 2007 | CERC Corp. | Revolver | 915 | 248 | (3) | June 29, 2012 | |||||||
September 15, 2010 | CERC | Receivables | 375 | — | September 14, 2011 |
(1) | Based on the debt (excluding transition and system restoration bonds) to earnings before interest, taxes, depreciation and amortization (EBITDA) covenant contained in our $1.2 billion credit facility, we would have been permitted to |
(2) | Represents outstanding letters of credit. |
(3) | Represents commercial paper that is backstopped by CERC Corp.’s revolving credit facility. |
Moody’s | S&P | Fitch | ||||||||||||||
Company/Instrument | Rating | Rating | Outlook(2) | Rating | Outlook(3) | |||||||||||
CenterPoint Energy Senior Unsecured Debt | Ba1 | Positive | BBB- | Stable | BBB- | |||||||||||
CenterPoint Houston Senior Secured Debt | Stable | |||||||||||||||
BBB+ | A- | Stable | ||||||||||||||
CERC Corp. Senior Unsecured Debt | Baa3 | Positive | BBB | Stable | BBB | Stable |
(1) | A Moody’s rating outlook is an opinion regarding the likely direction of a rating over the medium term. |
(2) | An S&P rating outlook assesses the potential direction of a long-term credit rating over the intermediate to longer term. |
(3) | A "stable" outlook from Fitch encompasses a one- to two-year horizon as to the likely ratings direction. |
/s/ DAVID M. MCCLANAHAN | |
President and Chief Executive Officer | |
/s/ GARY L. WHITLOCK | |
Executive Vice President and Chief | |
Financial Officer |
Year Ended December 31, | ||||||||||||
2007 | 2008 | 2009 | ||||||||||
(In millions, | ||||||||||||
except for share amounts) | ||||||||||||
Revenues | $ | 9,623 | $ | 11,322 | $ | 8,281 | ||||||
Expenses: | ||||||||||||
Natural gas | 5,995 | 7,466 | 4,371 | |||||||||
Operation and maintenance | 1,440 | 1,502 | 1,664 | |||||||||
Depreciation and amortization | 631 | 708 | 743 | |||||||||
Taxes other than income taxes | 372 | 373 | 379 | |||||||||
Total | 8,438 | 10,049 | 7,157 | |||||||||
Operating Income | 1,185 | 1,273 | 1,124 | |||||||||
Other Income (Expense): | ||||||||||||
Gain (loss) on marketable securities | (114 | ) | (139 | ) | 82 | |||||||
Gain (loss) on indexed debt securities | 111 | 128 | (68 | ) | ||||||||
Interest and other finance charges | (509 | ) | (468 | ) | (513 | ) | ||||||
Interest on transition and system restoration bonds | (123 | ) | (136 | ) | (131 | ) | ||||||
Distribution from AOL Time Warner litigation settlement | 32 | - | 3 | |||||||||
Additional distribution to ZENS holders | (27 | ) | - | (3 | ) | |||||||
Equity in earnings of unconsolidated affiliates | 16 | 51 | 15 | |||||||||
Other, net | 17 | 14 | 39 | |||||||||
Total | (597 | ) | (550 | ) | (576 | ) | ||||||
Income Before Income Taxes | 588 | 723 | 548 | |||||||||
Income tax expense | (193 | ) | (277 | ) | (176 | ) | ||||||
Net Income | $ | 395 | $ | 446 | $ | 372 | ||||||
Basic Earnings Per Share | $ | 1.23 | $ | 1.32 | $ | 1.02 | ||||||
Diluted Earnings Per Share | $ | 1.15 | $ | 1.30 | $ | 1.01 |
Year Ended December 31, | ||||||||||||
2007 | 2008 | 2009 | ||||||||||
(In millions) | ||||||||||||
Net income | $ | 395 | $ | 446 | $ | 372 | ||||||
Other comprehensive income (loss): | ||||||||||||
Adjustment to pension and other postretirement plans (net of tax of $28, $32 and $2) | 34 | (79 | ) | 7 | ||||||||
Net deferred gain (loss) from cash flow hedges (net of tax of $6, $2 and $-0-) | 11 | (4 | ) | - | ||||||||
Reclassification of deferred gain from cash flow hedges realized in net income (net of tax of $14, $2 and $-0-) | (20 | ) | (4 | ) | - | |||||||
Other comprehensive income (loss) | 25 | (87 | ) | 7 | ||||||||
Comprehensive income | $ | 420 | $ | 359 | $ | 379 |
December 31, 2008 | December 31, 2009 | |||||||
(In millions) | ||||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 167 | $ | 740 | ||||
Investment in marketable securities | 218 | 300 | ||||||
Accounts receivable, net | 1,009 | 790 | ||||||
Accrued unbilled revenues | 541 | 485 | ||||||
Inventory | 569 | 327 | ||||||
Non-trading derivative assets | 118 | 39 | ||||||
Prepaid expense and other current assets | 413 | 223 | ||||||
Total current assets | 3,035 | 2,904 | ||||||
Property, Plant and Equipment, net | 10,296 | 10,788 | ||||||
Other Assets: | ||||||||
Goodwill | 1,696 | 1,696 | ||||||
Regulatory assets | 3,684 | 3,677 | ||||||
Non-trading derivative assets | 20 | 15 | ||||||
Investment in unconsolidated affiliates | 345 | 463 | ||||||
Notes receivable from unconsolidated affiliates | 323 | - | ||||||
Other | 277 | 230 | ||||||
Total other assets | 6,345 | 6,081 | ||||||
Total Assets | $ | 19,676 | $ | 19,773 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
Short-term borrowings | $ | 153 | $ | 55 | ||||
Current portion of transition and system restoration bonds long-term debt | 208 | 241 | ||||||
Current portion of indexed debt | 117 | 121 | ||||||
Current portion of other long-term debt | 8 | 541 | ||||||
Indexed debt securities derivative | 133 | 201 | ||||||
Accounts payable | 897 | 648 | ||||||
Taxes accrued | 189 | 148 | ||||||
Interest accrued | 180 | 181 | ||||||
Non-trading derivative liabilities | 87 | 51 | ||||||
Accumulated deferred income taxes, net | 372 | 406 | ||||||
Other | 504 | 445 | ||||||
Total current liabilities | 2,848 | 3,038 | ||||||
Other Liabilities: | ||||||||
Accumulated deferred income taxes, net | 2,608 | 2,776 | ||||||
Unamortized investment tax credits | 24 | 16 | ||||||
Non-trading derivative liabilities | 47 | 42 | ||||||
Benefit obligations | 849 | 861 | ||||||
Regulatory liabilities | 821 | 921 | ||||||
Other | 276 | 361 | ||||||
Total other liabilities | 4,625 | 4,977 | ||||||
Long-term Debt: | ||||||||
Transition and system restoration bonds | 2,381 | 2,805 | ||||||
Other | 7,800 | 6,314 | ||||||
Total long-term debt | 10,181 | 9,119 | ||||||
Commitments and Contingencies (Note 10) | ||||||||
Shareholders’ Equity | 2,022 | 2,639 | ||||||
Total Liabilities and Shareholders’ Equity | $ | 19,676 | $ | 19,773 |
Year Ended December 31, | ||||||||||||
2007 | 2008 | 2009 | ||||||||||
(In millions) | ||||||||||||
Cash Flows from Operating Activities: | ||||||||||||
Net income | $ | 395 | $ | 446 | $ | 372 | ||||||
Adjustments to reconcile income from continuing operations to net cash provided by operating activities: | ||||||||||||
Depreciation and amortization | 631 | 708 | 743 | |||||||||
Amortization of deferred financing costs | 69 | 29 | 37 | |||||||||
Deferred income taxes | - | 487 | 269 | |||||||||
Unrealized loss (gain) on marketable securities | 114 | 139 | (82 | ) | ||||||||
Unrealized loss (gain) on indexed debt securities | (111 | ) | (128 | ) | 68 | |||||||
Write-down of natural gas inventory | 11 | 30 | 6 | |||||||||
Equity in earnings of unconsolidated affiliates, net of distributions | (13 | ) | (51 | ) | (3 | ) | ||||||
Changes in other assets and liabilities: | ||||||||||||
Accounts receivable and unbilled revenues, net | - | (82 | ) | 283 | ||||||||
Inventory | (102 | ) | (109 | ) | 236 | |||||||
Accounts payable | (185 | ) | 87 | (237 | ) | |||||||
Fuel cost over (under) recovery | (93 | ) | 45 | (5 | ) | |||||||
Non-trading derivatives, net | 11 | (25 | ) | 28 | ||||||||
Margin deposits, net | 65 | (182 | ) | 116 | ||||||||
Interest and taxes accrued | (33 | ) | (118 | ) | (41 | ) | ||||||
Net regulatory assets and liabilities | 81 | (366 | ) | - | ||||||||
Other current assets | 13 | (27 | ) | 27 | ||||||||
Other current liabilities | (20 | ) | 29 | 6 | ||||||||
Other assets | (20 | ) | (20 | ) | (1 | ) | ||||||
Other liabilities | (51 | ) | (8 | ) | 3 | |||||||
Other, net | 12 | (33 | ) | 16 | ||||||||
Net cash provided by operating activities | 774 | 851 | 1,841 | |||||||||
Cash Flows from Investing Activities: | ||||||||||||
Capital expenditures | (1,114 | ) | (1,020 | ) | (1,160 | ) | ||||||
Decrease (increase) in restricted cash of transition and system restoration bond companies | (1 | ) | (11 | ) | 26 | |||||||
Decrease (increase) in notes receivable from unconsolidated affiliates | (148 | ) | (175 | ) | 323 | |||||||
Investment in unconsolidated affiliates | (39 | ) | (206 | ) | (115 | ) | ||||||
Other, net | 2 | 44 | 30 | |||||||||
Net cash used in investing activities | (1,300 | ) | (1,368 | ) | (896 | ) | ||||||
Cash Flows from Financing Activities: | ||||||||||||
Increase (decrease) in short-term borrowings, net | 45 | (79 | ) | (98 | ) | |||||||
Revolving credit facilities, net | 331 | 1,110 | (1,441 | ) | ||||||||
Proceeds from long-term debt | 900 | 1,088 | 1,165 | |||||||||
Payments of long-term debt | (548 | ) | (1,373 | ) | (222 | ) | ||||||
Debt issuance costs | (9 | ) | (26 | ) | (10 | ) | ||||||
Payment of common stock dividends | (218 | ) | (246 | ) | (276 | ) | ||||||
Proceeds from issuance of common stock, net | 22 | 80 | 504 | |||||||||
Other, net | 5 | 1 | 6 | |||||||||
Net cash provided by (used in) financing activities | 528 | 555 | (372 | ) | ||||||||
Net Increase in Cash and Cash Equivalents | 2 | 38 | 573 | |||||||||
Cash and Cash Equivalents at Beginning of Year | 127 | 129 | 167 | |||||||||
Cash and Cash Equivalents at End of Year | $ | 129 | $ | 167 | $ | 740 | ||||||
Supplemental Disclosure of Cash Flow Information: | ||||||||||||
Cash Payments: | ||||||||||||
Interest, net of capitalized interest | $ | 572 | $ | 586 | $ | 624 | ||||||
Income taxes (refunds), net | 205 | (84 | ) | (9 | ) | |||||||
Non-cash transactions: | ||||||||||||
Accounts payable related to capital expenditures | 75 | 96 | 84 |
Year Ended December 31, | ||||||||||||
2008 | 2009 | 2010 | ||||||||||
(in millions, | ||||||||||||
except per share amounts) | ||||||||||||
Revenues | $ | 11,322 | $ | 8,281 | $ | 8,785 | ||||||
Expenses: | ||||||||||||
Natural gas | 7,466 | 4,371 | 4,574 | |||||||||
Operation and maintenance | 1,502 | 1,664 | 1,719 | |||||||||
Depreciation and amortization | 708 | 743 | 864 | |||||||||
Taxes other than income taxes | 373 | 379 | 379 | |||||||||
Total | 10,049 | 7,157 | 7,536 | |||||||||
Operating Income | 1,273 | 1,124 | 1,249 | |||||||||
Other Income (Expense): | ||||||||||||
Gain (loss) on marketable securities | (139 | ) | 82 | 67 | ||||||||
Gain (loss) on indexed debt securities | 128 | (68 | ) | (31 | ) | |||||||
Interest and other finance charges | (468 | ) | (513 | ) | (481 | ) | ||||||
Interest on transition and system restoration bonds | (136 | ) | (131 | ) | (140 | ) | ||||||
Equity in earnings of unconsolidated affiliates | 51 | 15 | 29 | |||||||||
Other, net | 14 | 39 | 12 | |||||||||
Total | (550 | ) | (576 | ) | (544 | ) | ||||||
Income Before Income Taxes | 723 | 548 | 705 | |||||||||
Income tax expense | (277 | ) | (176 | ) | (263 | ) | ||||||
Net Income | $ | 446 | $ | 372 | $ | 442 | ||||||
Basic Earnings Per Share | $ | 1.32 | $ | 1.02 | $ | 1.08 | ||||||
Diluted Earnings Per Share | $ | 1.30 | $ | 1.01 | $ | 1.07 | ||||||
Dividends Declared Per Share | $ | 0.73 | $ | 0.76 | $ | 0.78 | ||||||
Weighted Average Shares Outstanding, Basic | 336 | 365 | 410 | |||||||||
Weighted Average Shares Outstanding, Diluted | 344 | 368 | 413 |
2007 | 2008 | 2009 | |||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | ||||||||||
(In millions of dollars and shares) | |||||||||||||||
Preference Stock, none outstanding | - | $ | - | - | $ | - | - | $ | - | ||||||
Cumulative Preferred Stock, $0.01 par value; authorized 20,000,000 shares, none outstanding | - | - | - | - | - | - | |||||||||
Common Stock, $0.01 par value; authorized 1,000,000,000 shares | |||||||||||||||
Balance, beginning of year | 314 | 3 | 323 | 3 | 346 | 3 | |||||||||
Issuances related to benefit and investment plans | 2 | - | 6 | - | 7 | - | |||||||||
Issuances related to convertible debt conversions | 7 | - | 17 | - | - | - | |||||||||
Issuances related to public offerings | - | - | - | - | 38 | 1 | |||||||||
Balance, end of year | 323 | 3 | 346 | 3 | 391 | 4 | |||||||||
Additional Paid-in-Capital | |||||||||||||||
Balance, beginning of year | 2,977 | 3,046 | 3,158 | ||||||||||||
Cumulative effect of adoption of convertible debt pronouncement (See Note 2(o)) | 23 | - | - | ||||||||||||
Balance, beginning of year (as adjusted) | 3,000 | 3,046 | 3,158 | ||||||||||||
Issuances related to benefit and investment plans | 46 | 112 | 86 | ||||||||||||
Issuances related to public offerings, net of issuance costs | - | - | 427 | ||||||||||||
Balance, end of year | 3,046 | 3,158 | 3,671 | ||||||||||||
Accumulated Deficit | |||||||||||||||
Balance, beginning of year | (1,355 | ) | (1,194 | ) | (1,008 | ) | |||||||||
Cumulative effect of adoption of convertible debt pronouncement (See Note 2(o)) | (18 | ) | - | - | |||||||||||
Cumulative effect of change in accounting principle (see Note 2(p)) | - | (15 | ) | - | |||||||||||
Balance, beginning of year (as adjusted) | (1,373 | ) | (1,209 | ) | (1,008 | ) | |||||||||
Net income | 395 | 446 | 372 | ||||||||||||
Cumulative effect of uncertain tax positions standard | 2 | - | - | ||||||||||||
Common stock dividends - $0.68 per share in 2007, $0.73 per share in 2008, and $0.76 per share in 2009 | (218 | ) | (245 | ) | (276 | ) | |||||||||
Balance, end of year | (1,194 | ) | (1,008 | ) | (912 | ) | |||||||||
Accumulated Other Comprehensive Loss | |||||||||||||||
Balance, end of year: | |||||||||||||||
Adjustment to pension and postretirement plans | (48 | ) | (127 | ) | (120 | ) | |||||||||
Net deferred gain (loss) from cash flow hedges | 4 | (4 | ) | (4 | ) | ||||||||||
Total accumulated other comprehensive loss, end of year | (44 | ) | (131 | ) | (124 | ) | |||||||||
Total Shareholders’ Equity | $ | 1,811 | $ | 2,022 | $ | 2,639 |
Year Ended December 31, | ||||||||||||
2008 | 2009 | 2010 | ||||||||||
(in millions) | ||||||||||||
Net income | $ | 446 | $ | 372 | $ | 442 | ||||||
Other comprehensive income (loss): | ||||||||||||
Adjustment to pension and other postretirement plans (net of tax of $32, $2 and $5) | (79 | ) | 7 | 6 | ||||||||
Net deferred loss from cash flow hedges (net of tax of $2, $-0- and $-0-) | (4 | ) | — | — | ||||||||
Reclassification of deferred loss (gain) from cash flow hedges realized in net income (net of tax of $2, $-0- and $-0-) | (4 | ) | — | 1 | ||||||||
Other comprehensive income (loss) | (87 | ) | 7 | 7 | ||||||||
Comprehensive income | $ | 359 | $ | 379 | $ | 449 |
December 31, 2009 | December 31, 2010 | |||||||
(in millions) | ||||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents ($151 and $198 related to VIEs at December 31, 2009 and 2010, respectively) | $ | 740 | $ | 199 | ||||
Investment in marketable securities | 300 | 367 | ||||||
Accounts receivable, net ($44 and $49 related to VIEs at December 31, 2009 and 2010, respectively) | 790 | 835 | ||||||
Accrued unbilled revenues | 485 | 340 | ||||||
Inventory | 327 | 375 | ||||||
Non-trading derivative assets | 39 | 54 | ||||||
Taxes receivable | — | 138 | ||||||
Prepaid expense and other current assets ($34 and $39 related to VIEs at December 31, 2009 and 2010, respectively) | 223 | 274 | ||||||
Total current assets | 2,904 | 2,582 | ||||||
Property, Plant and Equipment, net | 10,788 | 11,732 | ||||||
Other Assets: | ||||||||
Goodwill | 1,696 | 1,696 | ||||||
Regulatory assets ($2,886 and $2,597 related to VIEs at December 31, 2009 and 2010, respectively) | 3,677 | 3,446 | ||||||
Non-trading derivative assets | 15 | 15 | ||||||
Investment in unconsolidated affiliates | 463 | 468 | ||||||
Other | 230 | 172 | ||||||
Total other assets | 6,081 | 5,797 | ||||||
Total Assets | $ | 19,773 | $ | 20,111 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
Short-term borrowings | $ | 55 | $ | 53 | ||||
Current portion of VIE transition and system restoration bonds long-term debt | 241 | 283 | ||||||
Current portion of indexed debt | 121 | 126 | ||||||
Current portion of other long-term debt | 541 | 19 | ||||||
Indexed debt securities derivative | 201 | 232 | ||||||
Accounts payable | 648 | 667 | ||||||
Taxes accrued | 148 | 156 | ||||||
Interest accrued | 181 | 171 | ||||||
Non-trading derivative liabilities | 51 | 68 | ||||||
Accumulated deferred income taxes, net | 406 | 407 | ||||||
Other | 445 | 438 | ||||||
Total current liabilities | 3,038 | 2,620 | ||||||
Other Liabilities: | ||||||||
Accumulated deferred income taxes, net | 2,776 | 2,934 | ||||||
Unamortized investment tax credits | 16 | 9 | ||||||
Non-trading derivative liabilities | 42 | 16 | ||||||
Benefit obligations | 861 | 906 | ||||||
Regulatory liabilities | 921 | 989 | ||||||
Other | 361 | 438 | ||||||
Total other liabilities | 4,977 | 5,292 | ||||||
Long-term Debt: | ||||||||
VIE transition and system restoration bonds | 2,805 | 2,522 | ||||||
Other | 6,314 | 6,479 | ||||||
Total long-term debt | 9,119 | 9,001 | ||||||
Commitments and Contingencies (Note 13) | ||||||||
Shareholders’ Equity | 2,639 | 3,198 | ||||||
Total Liabilities and Shareholders’ Equity | $ | 19,773 | $ | 20,111 |
Year Ended December 31, | ||||||||||||
2008 | 2009 | 2010 | ||||||||||
(in millions) | ||||||||||||
Cash Flows from Operating Activities: | ||||||||||||
Net income | $ | 446 | $ | 372 | $ | 442 | ||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
Depreciation and amortization | 708 | 743 | 864 | |||||||||
Amortization of deferred financing costs | 29 | 37 | 27 | |||||||||
Deferred income taxes | 487 | 269 | 199 | |||||||||
Unrealized loss (gain) on marketable securities | 139 | (82 | ) | (67 | ) | |||||||
Unrealized loss (gain) on indexed debt securities | (128 | ) | 68 | 31 | ||||||||
Write-down of natural gas inventory | 30 | 6 | 6 | |||||||||
Equity in earnings of unconsolidated affiliates, net of distributions | (51 | ) | (3 | ) | 13 | |||||||
Changes in other assets and liabilities: | ||||||||||||
Accounts receivable and unbilled revenues, net | (82 | ) | 283 | 101 | ||||||||
Inventory | (109 | ) | 236 | (54 | ) | |||||||
Taxes receivable | — | — | (138 | ) | ||||||||
Accounts payable | 87 | (237 | ) | (34 | ) | |||||||
Fuel cost over (under) recovery | 45 | (5 | ) | (9 | ) | |||||||
Non-trading derivatives, net | (25 | ) | 28 | (5 | ) | |||||||
Margin deposits, net | (182 | ) | 116 | 7 | ||||||||
Interest and taxes accrued | (118 | ) | (41 | ) | (2 | ) | ||||||
Net regulatory assets and liabilities | (366 | ) | — | 14 | ||||||||
Other current assets | (27 | ) | 27 | (2 | ) | |||||||
Other current liabilities | 29 | 6 | (1 | ) | ||||||||
Other assets | (20 | ) | (1 | ) | (8 | ) | ||||||
Other liabilities | (8 | ) | 3 | 4 | ||||||||
Other, net | (33 | ) | 16 | (2 | ) | |||||||
Net cash provided by operating activities | 851 | 1,841 | 1,386 | |||||||||
Cash Flows from Investing Activities: | ||||||||||||
Capital expenditures | (1,020 | ) | (1,160 | ) | (1,509 | ) | ||||||
Decrease (increase) in restricted cash of transition and system restoration bond companies | (11 | ) | 26 | (5 | ) | |||||||
Decrease (increase) in notes receivable from unconsolidated affiliates | (175 | ) | 323 | — | ||||||||
Investment in unconsolidated affiliates | (206 | ) | (115 | ) | (18 | ) | ||||||
Cash received from U.S. Department of Energy grant | — | — | 90 | |||||||||
Other, net | 44 | 30 | 22 | |||||||||
Net cash used in investing activities | (1,368 | ) | (896 | ) | (1,420 | ) | ||||||
Cash Flows from Financing Activities: | ||||||||||||
Decrease in short-term borrowings, net | (79 | ) | (98 | ) | (2 | ) | ||||||
Revolving credit facilities, net | 1,110 | (1,441 | ) | — | ||||||||
Proceeds from commercial paper, net | — | — | 183 | |||||||||
Proceeds from long-term debt | 1,088 | 1,165 | — | |||||||||
Payments of long-term debt | (1,373 | ) | (222 | ) | (783 | ) | ||||||
Debt issuance costs | (26 | ) | (10 | ) | (2 | ) | ||||||
Payment of common stock dividends | (246 | ) | (276 | ) | (319 | ) | ||||||
Proceeds from issuance of common stock, net | 80 | 504 | 416 | |||||||||
Other, net | 1 | 6 | — | |||||||||
Net cash provided by (used in) financing activities | 555 | (372 | ) | (507 | ) | |||||||
Net Increase (Decrease) in Cash and Cash Equivalents | 38 | 573 | (541 | ) | ||||||||
Cash and Cash Equivalents at Beginning of Year | 129 | 167 | 740 | |||||||||
Cash and Cash Equivalents at End of Year | $ | 167 | $ | 740 | $ | 199 | ||||||
Supplemental Disclosure of Cash Flow Information: | ||||||||||||
Cash Payments: | ||||||||||||
Interest, net of capitalized interest | $ | 586 | $ | 624 | $ | 609 | ||||||
Income taxes (refunds), net | (84 | ) | (9 | ) | 207 | |||||||
Non-cash transactions: | ||||||||||||
Accounts payable related to capital expenditures | 96 | 84 | 137 |
2008 | 2009 | 2010 | ||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||
(in millions of dollars and shares) | ||||||||||||||||||||||||
Preference Stock, none outstanding | — | $ | — | — | $ | — | — | $ | — | |||||||||||||||
Cumulative Preferred Stock, $0.01 par value; authorized 20,000,000 shares, none outstanding | — | — | — | — | — | — | ||||||||||||||||||
Common Stock, $0.01 par value; authorized 1,000,000,000 shares | ||||||||||||||||||||||||
Balance, beginning of year | 323 | 3 | 346 | 3 | 391 | 4 | ||||||||||||||||||
Issuances related to benefit and investment plans | 6 | — | 7 | — | 9 | — | ||||||||||||||||||
Issuances related to convertible debt conversions | 17 | — | — | — | — | — | ||||||||||||||||||
Issuances related to public offerings | — | — | 38 | 1 | 25 | — | ||||||||||||||||||
Balance, end of year | 346 | 3 | 391 | 4 | 425 | 4 | ||||||||||||||||||
Additional Paid-in-Capital | ||||||||||||||||||||||||
Balance, beginning of year | 3,046 | 3,158 | 3,671 | |||||||||||||||||||||
Issuances related to benefit and investment plans | 112 | 86 | 114 | |||||||||||||||||||||
Issuances related to public offerings, net of issuance costs | — | 427 | 315 | |||||||||||||||||||||
Balance, end of year | 3,158 | 3,671 | 4,100 | |||||||||||||||||||||
Accumulated Deficit | ||||||||||||||||||||||||
Balance, beginning of year | (1,194 | ) | (1,008 | ) | (912 | ) | ||||||||||||||||||
Cumulative effect of change in accounting principle (see Note 6(e)) | (15 | ) | — | — | ||||||||||||||||||||
Balance, beginning of year (as adjusted) | (1,209 | ) | (1,008 | ) | (912 | ) | ||||||||||||||||||
Net income | 446 | 372 | 442 | |||||||||||||||||||||
Common stock dividends — $0.73 per share in 2008, $0.76 per share in 2009 and $0.78 per share in 2010 | (245 | ) | (276 | ) | (319 | ) | ||||||||||||||||||
Balance, end of year | (1,008 | ) | (912 | ) | (789 | ) | ||||||||||||||||||
Accumulated Other Comprehensive Loss | ||||||||||||||||||||||||
Balance, end of year: | ||||||||||||||||||||||||
Adjustment to pension and postretirement plans | (127 | ) | (120 | ) | (114 | ) | ||||||||||||||||||
Net deferred loss from cash flow hedges | (4 | ) | (4 | ) | (3 | ) | ||||||||||||||||||
Total accumulated other comprehensive loss, end of year | (131 | ) | (124 | ) | (117 | ) | ||||||||||||||||||
Total Shareholders’ Equity | $ | 2,022 | $ | 2,639 | $ | 3,198 |
Weighted Average | ||||||||||||
Useful Lives | December 31, | |||||||||||
(Years) | 2008 | 2009 | ||||||||||
(In millions) | ||||||||||||
Electric Transmission & Distribution | 27 | $ | 7,256 | $ | 7,325 | |||||||
Natural Gas Distribution | 31 | 3,266 | 3,436 | |||||||||
Competitive Natural Gas Sales and Services | 26 | 67 | 69 | |||||||||
Interstate Pipelines | 58 | 2,334 | 2,524 | |||||||||
Field Services | 51 | 601 | 931 | |||||||||
Other property | 26 | 482 | 485 | |||||||||
Total | 14,006 | 14,770 | ||||||||||
Accumulated depreciation and amortization: | ||||||||||||
Electric Transmission & Distribution | 2,652 | 2,737 | ||||||||||
Natural Gas Distribution | 708 | 825 | ||||||||||
Competitive Natural Gas Sales and Services | 11 | 13 | ||||||||||
Interstate Pipelines | 182 | 223 | ||||||||||
Field Services | 28 | 27 | ||||||||||
Other property | 129 | 157 | ||||||||||
Total accumulated depreciation and amortization | 3,710 | 3,982 | ||||||||||
Property, plant and equipment, net | $ | 10,296 | $ | 10,788 |
Natural Gas Distribution | $ | 746 | ||
Interstate Pipelines | 579 | |||
Competitive Natural Gas Sales and Services | 335 | |||
Field Services | 25 | |||
Other Operations | 11 | |||
Total | $ | 1,696 |
December 31, | ||||||||
2008 | 2009 | |||||||
(In millions) | ||||||||
Securitized regulatory asset (1) | $ | 2,430 | $ | 2,886 | ||||
Unrecognized equity return | (207 | ) | (232 | ) | ||||
Unamortized loss on reacquired debt | 73 | 67 | ||||||
Hurricane Ike restoration cost (1) | 435 | 5 | ||||||
Pension and postretirement-related regulatory asset | 848 | 781 | ||||||
Other long-term regulatory assets(2) | 105 | 170 | ||||||
Total regulatory assets (1) | 3,684 | 3,677 | ||||||
Estimated removal costs | 779 | 818 | ||||||
Other long-term regulatory liabilities | 42 | 103 | ||||||
Total regulatory liabilities | 821 | 921 | ||||||
Total regulatory assets and liabilities, net | $ | 2,863 | $ | 2,756 |
2007 | 2008 | 2009 | ||||||||||
Depreciation expense | $ | 455 | $ | 478 | $ | 496 | ||||||
Amortization expense | 176 | 230 | 247 | |||||||||
Total depreciation and amortization expense | $ | 631 | $ | 708 | $ | 743 |
December 31, | December 31, | |||||||||||||||
2008 | 2009 | 2009 | 2010 | |||||||||||||
(In millions) | (in millions) | |||||||||||||||
Materials and supplies | $ | 128 | $ | 138 | $ | 138 | $ | 164 | ||||||||
Natural gas | 441 | 189 | 189 | 211 | ||||||||||||
Total inventory | $ | 569 | $ | 327 | $ | 327 | $ | 375 |
Weighted Average | |||||||||||
Useful Lives | December 31, | ||||||||||
(Years) | 2009 | 2010 | |||||||||
(in millions) | |||||||||||
Electric Transmission & Distribution | 27 | $ | 7,325 | $ | 7,586 | ||||||
Natural Gas Distribution | 31 | 3,436 | 3,642 | ||||||||
Competitive Natural Gas Sales and Services | 26 | 69 | 71 | ||||||||
Interstate Pipelines | 58 | 2,524 | 2,594 | ||||||||
Field Services | 46 | 931 | 1,583 | ||||||||
Other property | 25 | 485 | 529 | ||||||||
Total | 14,770 | 16,005 | |||||||||
Accumulated depreciation and amortization: | |||||||||||
Electric Transmission & Distribution | 2,737 | 2,805 | |||||||||
Natural Gas Distribution | 825 | 954 | |||||||||
Competitive Natural Gas Sales and Services | 13 | 16 | |||||||||
Interstate Pipelines | 223 | 265 | |||||||||
Field Services | 27 | 43 | |||||||||
Other property | 157 | 190 | |||||||||
Total accumulated depreciation and amortization | 3,982 | 4,273 | |||||||||
Property, plant and equipment, net | $ | 10,788 | $ | 11,732 |
2008 | 2009 | 2010 | ||||||||||
Depreciation expense | $ | 478 | $ | 496 | $ | 531 | ||||||
Amortization expense | 230 | 247 | 333 | |||||||||
Total depreciation and amortization expense | $ | 708 | $ | 743 | $ | 864 |
December 31, | ||||||||
2009 | 2010 | |||||||
Beginning balance | $ | 63 | $ | 82 | ||||
Accretion expense | 7 | 5 | ||||||
Revisions in estimates of cash flows | 12 | (3 | ) | |||||
Ending balance | $ | 82 | $ | 84 |
Natural Gas Distribution | $ | 746 | ||
Interstate Pipelines | 579 | |||
Competitive Natural Gas Sales and Services | 335 | |||
Field Services | 25 | |||
Other Operations | 11 | |||
Total | $ | 1,696 |
December 31, | ||||||||
2009 | 2010 | |||||||
(in millions) | ||||||||
Securitized regulatory assets | $ | 2,886 | $ | 2,597 | ||||
Unrecognized equity return | (232 | ) | (216 | ) | ||||
Unamortized loss on reacquired debt | 67 | 61 | ||||||
Pension and postretirement-related regulatory asset (1) | 813 | 838 | ||||||
Other long-term regulatory assets | 143 | 166 | ||||||
Total regulatory assets (1) | 3,677 | 3,446 | ||||||
Estimated removal costs | 818 | 868 | ||||||
Other long-term regulatory liabilities | 103 | 121 | ||||||
Total regulatory liabilities | 921 | 989 | ||||||
Total regulatory assets and liabilities, net | $ | 2,756 | $ | 2,457 |
(1) | CenterPoint Houston’s actuarially determined pension expense for 2009 and 2010 in excess of the 2007 base year amount is being deferred for rate making purposes and is being addressed in its current rate application pursuant to Texas law. CenterPoint Houston deferred as a regulatory asset $32 million and $26 million in pension and other postemployment expenses during the years ended December 31, 2009 and 2010, respectively. Deferred pension expense of $32 million and $58 million at December 31, 2009 and 2010, respectively, is not earning a return. Other regulatory assets that are not earning a return were not material at December 31, 2009 and 2010. |
Outstanding Options Year Ended December 31, 2009 | Outstanding Options Year Ended December 31, 2010 | |||||||||||||||||||||||||||||
Shares (Thousands) | Weighted-Average Exercise Price | Remaining Average Contractual Life (Years) | Aggregate Intrinsic Value (Millions) | Shares (Thousands) | Weighted-Average Exercise Price | Remaining Average Contractual Life (Years) | Aggregate Intrinsic Value (Millions) | |||||||||||||||||||||||
Outstanding at December 31, 2008 | 5,856 | $ | 17.67 | |||||||||||||||||||||||||||
Outstanding at December 31, 2009 | 4,513 | $ | 17.95 | |||||||||||||||||||||||||||
Expired | (573 | ) | 18.28 | (399 | ) | 17.25 | ||||||||||||||||||||||||
Cancelled | (295 | ) | 25.63 | (207 | ) | 31.48 | ||||||||||||||||||||||||
Exercised | (475 | ) | 9.23 | (830 | ) | 10.05 | ||||||||||||||||||||||||
Outstanding at December 31, 2009 | 4,513 | 17.95 | 1.9 | $ | 14 | |||||||||||||||||||||||||
Exercisable at December 31, 2009 | 4,513 | 17.95 | 1.9 | 14 | ||||||||||||||||||||||||||
Outstanding at December 31, 2010 | 3,077 | 19.27 | 1.3 | $ | 12 | |||||||||||||||||||||||||
Exercisable at December 31, 2010 | 3,077 | 19.27 | 1.3 | 12 |
Outstanding and Non-Vested Shares Year Ended December 31, 2009 | |||||||||||||||
Shares (Thousands) | Weighted-Average Grant Date Fair Value | Remaining Average Contractual Life (Years) | Aggregate Intrinsic Value (Millions) | ||||||||||||
Outstanding at December 31, 2008 | 2,102 | $ | 15.37 | ||||||||||||
Granted | 1,219 | 12.42 | |||||||||||||
Forfeited or cancelled | (222 | ) | 13.25 | ||||||||||||
Vested and released to participants | (516 | ) | 13.08 | ||||||||||||
Outstanding at December 31, 2009 | 2,583 | 14.62 | 1.2 | $ | 28 |
Outstanding and Non-Vested Shares Year Ended December 31, 2010 | |||||||||||||||
Shares (Thousands) | Weighted-Average Grant Date Fair Value | Remaining Average Contractual Life (Years) | Aggregate Intrinsic Value (Millions) | ||||||||||||
Outstanding at December 31, 2009 | 2,583 | $ | 14.62 | ||||||||||||
Granted | 1,130 | 14.21 | |||||||||||||
Forfeited or cancelled | (350 | ) | 17.24 | ||||||||||||
Vested and released to participants | (295 | ) | 18.09 | ||||||||||||
Outstanding at December 31, 2010 | 3,068 | 13.84 | 1.1 | $ | 37 |
Outstanding and Non-Vested Stock Shares Year Ended December 31, 2009 | Outstanding and Non-Vested Stock Shares Year Ended December 31, 2010 | |||||||||||||||||||||||||||||
Shares (Thousands) | Weighted-Average Grant Date Fair Value | Remaining Average Contractual Life (Years) | Aggregate Intrinsic Value (Millions) | Shares (Thousands) | Weighted-Average Grant Date Fair Value | Remaining Average Contractual Life (Years) | Aggregate Intrinsic Value (Millions) | |||||||||||||||||||||||
Outstanding at December 31, 2008 | 789 | $ | 15.33 | |||||||||||||||||||||||||||
Outstanding at December 31, 2009 | 951 | $ | 14.36 | |||||||||||||||||||||||||||
Granted | 460 | 12.30 | 440 | 14.26 | ||||||||||||||||||||||||||
Forfeited or cancelled | (9 | ) | 14.02 | (25 | ) | 13.38 | ||||||||||||||||||||||||
Vested and released to participants | (289 | ) | 13.73 | (270 | ) | 16.65 | ||||||||||||||||||||||||
Outstanding at December 31, 2009 | 951 | 14.36 | 1.3 | $ | 14 | |||||||||||||||||||||||||
Outstanding at December 31, 2010 | 1,096 | 13.78 | 1.2 | $ | 17 |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
Performance awards | $ | 18.20 | $ | 15.40 | $ | 12.42 | $ | 15.40 | $ | 12.42 | $ | 14.21 | ||||||||||||
Stock awards | 18.29 | 15.09 | 12.30 | 15.09 | 12.30 | 14.26 |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
(In millions) | (in millions) | |||||||||||||||||||||||
Stock options exercised | $ | 13 | $ | 2 | $ | 2 | $ | 2 | $ | 2 | $ | 4 | ||||||||||||
Performance awards | 3 | 6 | 7 | 6 | 7 | 5 | ||||||||||||||||||
Stock awards | 4 | 5 | 4 | 5 | 4 | 4 |
Year Ended December 31, | ||||||||||||||||||||||||||||||||||||||||||||||||
2007 | 2008 | 2009 | Year Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||
Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | 2008 | 2009 | 2010 | ||||||||||||||||||||||||||||||||||||||||
(In millions) | Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | ||||||||||||||||||||||||||||||||||||||||||
(in millions) | ||||||||||||||||||||||||||||||||||||||||||||||||
Service cost | $ | 37 | $ | 2 | $ | 31 | $ | 1 | $ | 25 | $ | 1 | $ | 31 | $ | 1 | $ | 25 | $ | 1 | $ | 31 | $ | 1 | ||||||||||||||||||||||||
Interest cost | 100 | 26 | 101 | 27 | 113 | 28 | 101 | 27 | 113 | 28 | 102 | 25 | ||||||||||||||||||||||||||||||||||||
Expected return on plan assets | (149 | ) | (12 | ) | (147 | ) | (12 | ) | (98 | ) | (9 | ) | (147 | ) | (12 | ) | (98 | ) | (9 | ) | (109 | ) | (10 | ) | ||||||||||||||||||||||||
Amortization of prior service cost (credit) | (7 | ) | - | (8 | ) | 3 | 3 | 3 | (8 | ) | 3 | 3 | 3 | 3 | 3 | |||||||||||||||||||||||||||||||||
Amortization of net loss | 34 | 3 | 23 | - | 68 | - | 23 | — | 68 | — | 59 | — | ||||||||||||||||||||||||||||||||||||
Amortization of transition obligation | - | 7 | - | 7 | - | 7 | — | 7 | — | 7 | — | 7 | ||||||||||||||||||||||||||||||||||||
Benefit enhancement | - | - | 1 | - | - | - | 1 | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Net periodic cost | $ | 15 | $ | 26 | $ | 1 | $ | 26 | $ | 111 | $ | 30 | $ | 1 | 26 | 111 | 30 | 86 | 26 |
December 31, | December 31, | |||||||||||||||||||||||||||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||||||||||||||||||||||||||
Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | |||||||||||||||||||||||||||||||||||||
Discount rate | 5.85 | % | 5.85 | % | 6.40 | % | 6.40 | % | 6.90 | % | 6.90 | % | 6.40 | % | 6.40 | % | 6.90 | % | 6.90 | % | 5.70 | % | 5.70 | % | ||||||||||||||||||||||||
Expected return on plan assets | 8.50 | 7.60 | 8.50 | 7.60 | 8.00 | 7.05 | 8.50 | 7.60 | 8.00 | 7.05 | 8.00 | 7.05 | ||||||||||||||||||||||||||||||||||||
Rate of increase in compensation levels | 4.60 | - | 4.60 | - | 4.60 | - | 4.60 | — | 4.60 | — | 4.60 | — |
December 31, | ||||||||||||||||
2008 | 2009 | |||||||||||||||
Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | |||||||||||||
(In millions, except for actuarial assumptions) | ||||||||||||||||
Change in Benefit Obligation | ||||||||||||||||
Benefit obligation, beginning of year | $ | 1,645 | $ | 437 | $ | 1,710 | $ | 426 | ||||||||
Service cost | 31 | 1 | 25 | 1 | ||||||||||||
Interest cost | 101 | 27 | 113 | 28 | ||||||||||||
Participant contributions | - | 5 | - | 6 | ||||||||||||
Benefits paid | (123 | ) | (38 | ) | (111 | ) | (42 | ) | ||||||||
Actuarial gain (loss) | (59 | ) | (10 | ) | 129 | 29 | ||||||||||
Plan amendment | 114 | - | - | - | ||||||||||||
Medicare reimbursement | - | 4 | - | 2 | ||||||||||||
Benefit enhancement | 1 | - | - | - | ||||||||||||
Benefit obligation, end of year | 1,710 | 426 | 1,866 | 450 | ||||||||||||
Change in Plan Assets | ||||||||||||||||
Fair Value of plan assets, beginning of year | 1,792 | 161 | 1,276 | 135 | ||||||||||||
Employer contributions | 8 | 27 | 20 | 28 | ||||||||||||
Participant contributions | - | 5 | - | 6 | ||||||||||||
Benefits paid | (123 | ) | (38 | ) | (111 | ) | (42 | ) | ||||||||
Actual investment return | (401 | ) | (20 | ) | 247 | 19 | ||||||||||
Fair value of plan assets, end of year | 1,276 | 135 | 1,432 | 146 | ||||||||||||
Funded status, end of year | $ | (434 | ) | $ | (291 | ) | $ | (434 | ) | $ | (304 | ) | ||||
Amounts Recognized in Balance Sheets | ||||||||||||||||
Current liabilities-other | $ | (9 | ) | $ | (10 | ) | $ | (9 | ) | $ | (9 | ) | ||||
Other liabilities-benefit obligations | (425 | ) | (281 | ) | (425 | ) | (295 | ) | ||||||||
Net liability, end of year | $ | (434 | ) | $ | (291 | ) | $ | (434 | ) | $ | (304 | ) | ||||
Actuarial Assumptions | ||||||||||||||||
Discount rate | 6.90 | % | 6.90 | % | 5.70 | % | 5.70 | % | ||||||||
Expected return on plan assets | 8.00 | 7.05 | 8.00 | 7.05 | ||||||||||||
Rate of increase in compensation levels | 4.60 | - | 4.60 | - | ||||||||||||
Healthcare cost trend rate assumed for the next year | - | 6.50 | - | 7.50 | ||||||||||||
Prescription drug cost trend rate assumed for the next year | - | 12.00 | - | 8.00 | ||||||||||||
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) | - | 5.50 | - | 5.50 | ||||||||||||
Year that the healthcare rate reaches the ultimate trend rate | - | 2011 | - | 2014 | ||||||||||||
Year that the prescription drug rate reaches the ultimate trend rate | - | 2014 | - | 2015 |
December 31, | ||||||||||||||||
2009 | 2010 | |||||||||||||||
Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | |||||||||||||
(in millions, except for actuarial assumptions) | ||||||||||||||||
Change in Benefit Obligation | ||||||||||||||||
Benefit obligation, beginning of year | $ | 1,710 | $ | 426 | $ | 1,866 | $ | 450 | ||||||||
Service cost | 25 | 1 | 31 | 1 | ||||||||||||
Interest cost | 113 | 28 | 102 | 25 | ||||||||||||
Participant contributions | — | 6 | — | 7 | ||||||||||||
Benefits paid | (111 | ) | (42 | ) | (115 | ) | (50 | ) | ||||||||
Actuarial gain | 129 | 29 | 85 | 24 | ||||||||||||
Medicare reimbursement | — | 2 | — | 3 | ||||||||||||
Benefit obligation, end of year | 1,866 | 450 | 1,969 | 460 | ||||||||||||
Change in Plan Assets | ||||||||||||||||
Fair value of plan assets, beginning of year | 1,276 | 135 | 1,432 | 146 | ||||||||||||
Employer contributions | 20 | 28 | 8 | 29 | ||||||||||||
Participant contributions | — | 6 | — | 7 | ||||||||||||
Benefits paid | (111 | ) | (42 | ) | (115 | ) | (50 | ) | ||||||||
Actual investment return | 247 | 19 | 176 | 12 | ||||||||||||
Fair value of plan assets, end of year | 1,432 | 146 | 1,501 | 144 | ||||||||||||
Funded status, end of year | $ | (434 | ) | $ | (304 | ) | $ | (468 | ) | $ | (316 | ) | ||||
Amounts Recognized in Balance Sheets | ||||||||||||||||
Current liabilities-other | $ | (9 | ) | $ | (9 | ) | $ | (9 | ) | $ | (9 | ) | ||||
Other liabilities-benefit obligations | (425 | ) | (295 | ) | (459 | ) | (307 | ) | ||||||||
Net liability, end of year | $ | (434 | ) | $ | (304 | ) | $ | (468 | ) | $ | (316 | ) | ||||
Actuarial Assumptions | ||||||||||||||||
Discount rate | 5.70 | % | 5.70 | % | 5.25 | % | 5.20 | % | ||||||||
Expected return on plan assets | 8.00 | 7.05 | 8.00 | 7.05 | ||||||||||||
Rate of increase in compensation levels | 4.60 | — | 4.60 | — | ||||||||||||
Healthcare cost trend rate assumed for the next year | — | 7.50 | — | 8.50 | ||||||||||||
Prescription drug cost trend rate assumed for the next year | — | 8.00 | — | 8.50 | ||||||||||||
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) | — | 5.50 | — | 5.50 | ||||||||||||
Year that the healthcare rate reaches the ultimate trend rate | — | 2014 | — | 2017 | ||||||||||||
Year that the prescription drug rate reaches the ultimate trend rate | — | 2015 | — | 2017 |
December 31, | December 31, | |||||||||||||||||||||||||||||||
2008 | 2009 | 2009 | 2010 | |||||||||||||||||||||||||||||
Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | |||||||||||||||||||||||||
(In millions) | (in millions) | |||||||||||||||||||||||||||||||
Unrecognized actuarial loss | $ | 181 | $ | 5 | $ | 162 | $ | 15 | $ | 162 | $ | 15 | $ | 151 | $ | 18 | ||||||||||||||||
Unrecognized prior service cost | 17 | 11 | 16 | 9 | 16 | 9 | 15 | 7 | ||||||||||||||||||||||||
Unrecognized transition obligation | - | 3 | - | 3 | — | 3 | — | 2 | ||||||||||||||||||||||||
Net amount recognized in accumulated other comprehensive loss | $ | 198 | $ | 19 | $ | 178 | $ | 27 | $ | 178 | $ | 27 | $ | 166 | $ | 27 |
Pension Benefits | Postretirement Benefits | Pension Benefits | Postretirement Benefits | |||||||||||||
Net loss (gain) | $ | (34 | ) | $ | 10 | $ | (24 | ) | $ | 3 | ||||||
Amortization of net loss | 15 | - | 13 | — | ||||||||||||
Prior service credit | (2 | ) | (4 | ) | (2 | ) | (4 | ) | ||||||||
Amortization of prior service credit (cost) | 1 | 2 | ||||||||||||||
Amortization of prior service credit | 1 | 2 | ||||||||||||||
Transition obligation | — | (1 | ) | |||||||||||||
Total recognized in comprehensive income | $ | (20 | ) | $ | 8 | $ | (12 | ) | $ | — |
Pension Benefits | Postretirement Benefits | |||||||
Unrecognized actuarial loss | $ | 13 | $ | - | ||||
Unrecognized prior service cost | 1 | 2 | ||||||
Amounts in comprehensive income to be recognized in net periodic cost in 2010 | $ | 14 | $ | 2 |
Pension Benefits | Postretirement Benefits | |||||||
Unrecognized actuarial loss | $ | 12 | $ | — | ||||
Unrecognized prior service cost | 1 | 2 | ||||||
Amounts in accumulated comprehensive income to be recognized in net periodic cost in 2011 | $ | 13 | $ | 2 |
December 31, | December 31, | |||||||||||||||||||||||||||||||
2008 | 2009 | 2009 | 2010 | |||||||||||||||||||||||||||||
Pension Qualified | Pension Non-qualified | Pension Qualified | Pension Non-qualified | Pension Qualified | Pension Non-qualified | Pension Qualified | Pension Non-qualified | |||||||||||||||||||||||||
(In millions) | (in millions) | |||||||||||||||||||||||||||||||
Accumulated benefit obligation | $ | 1,622 | $ | 86 | $ | 1,770 | $ | 94 | $ | 1,770 | $ | 94 | $ | 1,860 | $ | 94 | ||||||||||||||||
Projected benefit obligation | 1,624 | 86 | 1,772 | 94 | 1,772 | 94 | 1,875 | 94 | ||||||||||||||||||||||||
Fair value of plan assets | 1,276 | - | 1,432 | - | 1,432 | — | 1,501 | — |
1% Increase | 1% Decrease | 1% Increase | 1% Decrease | |||||||||||||
(In millions) | (in millions) | |||||||||||||||
Effect on the postretirement benefit obligation | $ | 17 | $ | 15 | $ | 18 | $ | 16 | ||||||||
Effect on total of service and interest cost | 1 | 1 | 1 | 1 |
Pension Benefits | Postretirement Benefits | ||||||||
Domestic equity securities | 25-35% | ||||||||
Global equity securities | 7-13% | ||||||||
International equity securities | 17-23% | ||||||||
Debt securities | 30-40% | ||||||||
Real estate | 0-5% | ||||||||
Cash | 0-2% |
Fair Value Measurements at December 31, 2009 (in millions) | Fair Value Measurements at December 31, 2009 (in millions) | |||||||||||||||||||||||||||||||
Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||||||||||||||
Cash | $ | 11 | $ | 11 | $ | - | $ | - | $ | 11 | $ | 11 | $ | — | $ | — | ||||||||||||||||
Common collective trust funds (1) | 733 | - | 733 | - | 733 | — | 733 | — | ||||||||||||||||||||||||
Corporate Bonds: | ||||||||||||||||||||||||||||||||
Corporate bonds: | ||||||||||||||||||||||||||||||||
Investment grade or above | 193 | - | 192 | 1 | 193 | — | 192 | 1 | ||||||||||||||||||||||||
High yield | 2 | - | 2 | 2 | — | 2 | — | |||||||||||||||||||||||||
Equity securities: | ||||||||||||||||||||||||||||||||
International companies | 162 | 160 | 2 | - | 162 | 160 | 2 | — | ||||||||||||||||||||||||
U.S. companies | 96 | 96 | - | - | 96 | 96 | — | — | ||||||||||||||||||||||||
Securities received as collateral | 114 | 114 | - | - | ||||||||||||||||||||||||||||
U.S. government back agencies bonds | 55 | 55 | - | - | ||||||||||||||||||||||||||||
Cash received as collateral from securities lending | 114 | 114 | — | — | ||||||||||||||||||||||||||||
U.S. government backed agencies bonds | 55 | 55 | — | — | ||||||||||||||||||||||||||||
U.S. treasuries | 50 | 50 | - | - | 50 | 50 | — | — | ||||||||||||||||||||||||
Mortgage backed securities | 39 | - | 39 | - | 39 | — | 39 | — | ||||||||||||||||||||||||
Asset backed securities | 27 | - | 24 | 3 | 27 | — | 24 | 3 | ||||||||||||||||||||||||
Municipal bonds | 22 | 2 | 20 | - | 22 | 2 | 20 | — | ||||||||||||||||||||||||
Mutual funds (2) | 21 | 21 | - | - | 21 | 21 | — | — | ||||||||||||||||||||||||
International government bonds | 12 | - | 12 | - | 12 | — | 12 | — | ||||||||||||||||||||||||
Real estate | 9 | - | - | 9 | 9 | — | — | 9 | ||||||||||||||||||||||||
Obligation to return securities received as collateral | (114 | ) | (114 | ) | - | - | ||||||||||||||||||||||||||
Obligation to return cash received as collateral from securities lending | (114 | ) | (114 | ) | — | — | ||||||||||||||||||||||||||
Total | $ | 1,432 | $ | 395 | $ | 1,024 | $ | 13 | $ | 1,432 | $ | 395 | $ | 1,024 | $ | 13 |
(1) | 30% of the amount invested in common collective trust funds is in fixed income securities, 31% is in U.S. equities and 39% is in international equities. |
(2) | 48% of the amount invested in mutual funds is in fixed income securities and 52% is in U.S. equities. |
Fair Value Measurements at December 31, 2010 (in millions) | ||||||||||||||||
Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Cash | $ | 3 | $ | 3 | $ | — | $ | — | ||||||||
Common collective trust funds (1) | 890 | — | 890 | — | ||||||||||||
Corporate bonds: | ||||||||||||||||
Investment grade or above | 122 | — | 122 | — | ||||||||||||
Equity securities: | ||||||||||||||||
International companies | 133 | 133 | — | — | ||||||||||||
U.S. companies | 131 | 131 | — | — | ||||||||||||
Cash received as collateral from securities lending | 112 | 112 | — | — | ||||||||||||
U.S. government backed agencies bonds | 34 | 34 | — | — | ||||||||||||
U.S. treasuries | 62 | 62 | — | — | ||||||||||||
Mortgage backed securities | 8 | — | 8 | — | ||||||||||||
Asset backed securities | 10 | — | 10 | — | ||||||||||||
Municipal bonds | 28 | — | 28 | — | ||||||||||||
Mutual funds (2) | 55 | 55 | — | — | ||||||||||||
International government bonds | 17 | — | 17 | — | ||||||||||||
Real estate | 8 | — | — | 8 | ||||||||||||
Obligation to return cash received as collateral from securities lending | (112 | ) | (112 | ) | — | — | ||||||||||
Total | $ | 1,501 | $ | 418 | $ | 1,075 | $ | 8 |
(1) | 24% of the amount invested in common collective trust funds is in fixed income securities, 42% is in U.S. equities and 34% is in international equities. |
(2) | 74% of the amount invested in mutual funds is in fixed income securities and 26% is in U.S. equities. |
Level 3 Investments | ||||||||||||||||
Year Ended December 31, 2009 (in millions) | ||||||||||||||||
Corporate bonds | Asset backed securities | Real estate | Total | |||||||||||||
Balance, beginning of year | $ | 1 | $ | 3 | $ | 14 | $ | 18 | ||||||||
Unrealized gains/(losses) relating to instruments still held at the reporting date | - | - | (5 | ) | (5 | ) | ||||||||||
Balance, end of year | $ | 1 | $ | 3 | $ | 9 | $ | 13 |
Level 3 Investments | ||||||||||||||||
Year Ended December 31, 2009 (in millions) | ||||||||||||||||
Corporate bonds | Asset backed securities | Real estate | Total | |||||||||||||
Balance, beginning of year | $ | 1 | $ | 3 | $ | 14 | $ | 18 | ||||||||
Unrealized losses relating to instruments still held at the reporting date | — | — | (5 | ) | (5 | ) | ||||||||||
Balance, end of year | $ | 1 | $ | 3 | $ | 9 | $ | 13 |
Level 3 Investments | ||||||||||||||||
Year Ended December 31, 2010 (in millions) | ||||||||||||||||
Corporate bonds | Asset backed securities | Real estate | Total | |||||||||||||
Balance, beginning of year | $ | 1 | $ | 3 | $ | 9 | $ | 13 | ||||||||
Unrealized losses relating to instruments still held at the reporting date | — | — | (1 | ) | (1 | ) | ||||||||||
Purchases, sales, issuances, and settlement (net) | — | (1 | ) | — | (1 | ) | ||||||||||
Transfer out of Level 3 | (1 | ) | (2 | ) | — | (3 | ) | |||||||||
Balance, end of year | $ | — | $ | — | $ | 8 | $ | 8 |
Fair Value Measurements at December 31, 2009 (in millions) | Fair Value Measurements at December 31, 2009 (in millions) | ||||||||||||||||||||||||||||||
Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Observable Input (Level 2) | Significant Unobservable Inputs (Level 3) | Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Observable Inputs (Level 2) | Significant Unobservable Inputs Level 3) | ||||||||||||||||||||||||
Mutual funds (1) | $ | 146 | $ | 146 | $ | - | $ | - | $ | 146 | $ | 146 | $ | — | $ | — | |||||||||||||||
Total | $ | 146 | $ | 146 | $ | - | $ | - | $ | 146 | $ | 146 | $ | — | $ | — |
(1) | 65% of the amount invested in mutual funds is in fixed income securities, 26% is in U.S. equities and 9% is in international equities. |
Fair Value Measurements at December 31, 2010 (in millions) | |||||||||||||||
Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Observable Inputs (Level 2) | Significant Unobservable Inputs Level 3) | ||||||||||||
Mutual funds (1) | $ | 144 | $ | 144 | $ | — | $ | — | |||||||
Total | $ | 144 | $ | 144 | $ | — | $ | — |
(1) | 73% of the amount invested in mutual funds is in fixed income securities, 19% is in U.S. equities and 8% is in international equities. |
Postretirement Benefit Plan | Postretirement Benefit Plan | |||||||||||||||||||||||
Pension Benefits | Benefit Payments | Medicare Subsidy Receipts | Pension Benefits | Benefit Payments | Medicare Subsidy Receipts | |||||||||||||||||||
2010 | $ | 136 | $ | 33 | $ | (4 | ) | |||||||||||||||||
2011 | 138 | 35 | (5 | ) | $ | 142 | $ | 33 | $ | (4 | ) | |||||||||||||
2012 | 142 | 36 | (5 | ) | 148 | 34 | (5 | ) | ||||||||||||||||
2013 | 145 | 38 | (6 | ) | 149 | 39 | (5 | ) | ||||||||||||||||
2014 | 144 | 39 | (6 | ) | 149 | 40 | (6 | ) | ||||||||||||||||
2015-2019 | 743 | 216 | (38 | ) | ||||||||||||||||||||
2015 | 149 | 42 | (6 | ) | ||||||||||||||||||||
2016-2020 | 762 | 225 | (42 | ) |
Fair Value of Derivative Instruments | ||||||||||
December 31, 2009 | ||||||||||
Total derivatives not designated as hedging instruments | Balance Sheet Location | Derivative Assets Fair Value (2) (3) | Derivative Liabilities Fair Value (2) (3) | |||||||
(in millions) | ||||||||||
Commodity contracts (1) | Current Assets | $ | 46 | $ | (7 | ) | ||||
Commodity contracts (1) | Other Assets | 16 | (1 | ) | ||||||
Commodity contracts (1) | Current Liabilities | 20 | (123 | ) | ||||||
Commodity contracts (1) | Other Liabilities | 1 | (86 | ) | ||||||
Indexed debt securities derivative | Current Liabilities | - | (201 | ) | ||||||
Total | $ | 83 | $ | (418 | ) |
Fair Value of Derivative Instruments | ||||||||||
December 31, 2009 | ||||||||||
Total derivatives not designated as hedging instruments | Balance Sheet Location | Derivative Assets Fair Value (2) (3) | Derivative Liabilities Fair Value (2) (3) | |||||||
(in millions) | ||||||||||
Natural gas contracts (1) | Current Assets | $ | 46 | $ | (7 | ) | ||||
Natural gas contracts (1) | Other Assets | 16 | (1 | ) | ||||||
Natural gas contracts (1) | Current Liabilities | 20 | (123 | ) | ||||||
Natural gas contracts (1) | Other Liabilities | 1 | (86 | ) | ||||||
Indexed debt securities derivative | Current Liabilities | — | (201 | ) | ||||||
Total | $ | 83 | $ | (418 | ) |
(1) |
(2) | The fair value shown for |
(3) | The net of total non-trading derivative assets and liabilities is a $39 million liability as shown on CenterPoint Energy’s Consolidated Balance Sheets, and is comprised of the |
Fair Value of Derivative Instruments | ||||||||||
December 31, 2010 | ||||||||||
Total derivatives not designated as hedging instruments | Balance Sheet Location | Derivative Assets Fair Value (2) (3) | Derivative Liabilities Fair Value (2) (3) | |||||||
(in millions) | ||||||||||
Natural gas contracts (1) | Current Assets | $ | 55 | $ | (1 | ) | ||||
Natural gas contracts (1) | Other Assets | 15 | — | |||||||
Natural gas contracts (1) | Current Liabilities | 10 | (143 | ) | ||||||
Natural gas contracts (1) | Other Liabilities | — | (35 | ) | ||||||
Indexed debt securities derivative | Current Liabilities | — | (232 | ) | ||||||
Total | $ | 80 | $ | (411 | ) |
(1) | Natural gas contracts are subject to master netting arrangements and are presented on a net basis in the Consolidated Balance Sheets. This netting causes derivative assets (liabilities) to be ultimately presented net in a liability (asset) account within the Consolidated Balance Sheets. |
(2) | The fair value shown for natural gas contracts is comprised of derivative gross volumes totaling 626 Bcf or a net 72 Bcf long position. Of the net long position, basis swaps constitute 63 Bcf and volumes associated with price stabilization activities of the Natural Gas Distribution business segment comprise 26 Bcf. |
(3) | The net of total non-trading derivative assets and liabilities is a $15 million liability as shown on CenterPoint Energy’s Consolidated Balance Sheets, and is comprised of the natural gas contracts derivative assets and liabilities separately shown above offset by collateral netting of $84 million. |
Income Statement Impact of Derivative Activity | Income Statement Impact of Derivative Activity | Income Statement Impact of Derivative Activity | ||||||||||||||
Year Ended December 31, | ||||||||||||||||
Total derivatives not designated as hedging instruments | Income Statement Location | Year Ended December 31, 2009 | Income Statement Location | 2009 | 2010 | |||||||||||
(in millions) | (in millions) | |||||||||||||||
Commodity contracts | Gains (Losses) in Revenue | $ | 102 | |||||||||||||
Commodity contracts (1) | Gains (Losses) in Expense: Natural Gas | (255 | ) | |||||||||||||
Natural gas contracts | Gains (Losses) in Revenue | $ | 102 | $ | 90 | |||||||||||
Natural gas contracts (1) | Gains (Losses) in Expense: Natural Gas | (255 | ) | (165 | ) | |||||||||||
Indexed debt securities derivative | Gains (Losses) in Other Income (Expense) | (68 | ) | Gains (Losses) in Other Income (Expense) | (68 | ) | (31 | ) | ||||||||
Total | Total | $ | (221 | ) | Total | $ | (221 | ) | $ | (106 | ) |
(1) | The Gains (Losses) in Expense: Natural Gas includes $(181) million and $(115) million of costs in 2009 and 2010, respectively, associated with price stabilization activities of the Natural Gas Distribution business segment that will be ultimately recovered through purchased gas adjustments. |
December 31, 2009 | December 31, 2010 | |||||||||||||||
Investment Grade(1) | Total | Investment Grade(1) | Total | |||||||||||||
Energy marketers | $ | 6 | $ | 6 | $ | 5 | $ | 8 | ||||||||
Financial institutions | 2 | 4 | 1 | 1 | ||||||||||||
Retail end users (2) | 1 | 44 | — | 60 | ||||||||||||
Total | $ | 9 | $ | 54 | $ | 6 | $ | 69 |
December 31, 2008 | December 31, 2009 | |||||||||||||||
Investment Grade(1) | Total | Investment Grade(1) | Total | |||||||||||||
Energy marketers | $ | 8 | $ | 9 | $ | 6 | $ | 6 | ||||||||
Financial institutions | 4 | 4 | 2 | 4 | ||||||||||||
Retail end users (2) | 5 | 125 | 1 | 44 | ||||||||||||
Total | $ | 17 | $ | 138 | $ | 9 | $ | 54 |
(1) |
(2) | Retail end users represent |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Netting Adjustments (1) | Balance as of December 31, 2008 | ||||||||||||||||
(in millions) | ||||||||||||||||||||
Assets | ||||||||||||||||||||
Corporate equities | $ | 218 | $ | - | $ | - | $ | - | $ | 218 | ||||||||||
Investments, including money market funds | 70 | - | - | - | 70 | |||||||||||||||
Derivative assets | 8 | 155 | 49 | (74 | ) | 138 | ||||||||||||||
Total assets | $ | 296 | $ | 155 | $ | 49 | $ | (74 | ) | $ | 426 | |||||||||
Liabilities | ||||||||||||||||||||
Indexed debt securities derivative | $ | - | $ | 133 | $ | - | $ | - | $ | 133 | ||||||||||
Derivative liabilities | 44 | 244 | 107 | (261 | ) | 134 | ||||||||||||||
Total liabilities | $ | 44 | $ | 377 | $ | 107 | $ | (261 | ) | $ | 267 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Netting Adjustments (1) | Balance as of December 31, 2009 | ||||||||||||||||
(in millions) | ||||||||||||||||||||
Assets | ||||||||||||||||||||
Corporate equities | $ | 301 | $ | — | $ | — | $ | — | $ | 301 | ||||||||||
Investments, including money market funds | 41 | — | — | — | 41 | |||||||||||||||
Derivative assets | 1 | 77 | 5 | (29 | ) | 54 | ||||||||||||||
Total assets | $ | 343 | $ | 77 | $ | 5 | $ | (29 | ) | $ | 396 | |||||||||
Liabilities | ||||||||||||||||||||
Indexed debt securities derivative | $ | — | $ | 201 | $ | — | $ | — | $ | 201 | ||||||||||
Derivative liabilities | 12 | 194 | 11 | (124 | ) | 93 | ||||||||||||||
Total liabilities | $ | 12 | $ | 395 | $ | 11 | $ | (124 | ) | $ | 294 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Netting Adjustments (1) | Balance as of December 31, 2009 | ||||||||||||||||
(in millions) | ||||||||||||||||||||
Assets | ||||||||||||||||||||
Corporate equities | $ | 301 | $ | - | $ | - | $ | - | $ | 301 | ||||||||||
Investments, including money market funds | 41 | - | - | - | 41 | |||||||||||||||
Derivative assets | 1 | 77 | 5 | (29 | ) | 54 | ||||||||||||||
Total assets | $ | 343 | $ | 77 | $ | 5 | $ | (29 | ) | $ | 396 | |||||||||
Liabilities | ||||||||||||||||||||
Indexed debt securities derivative | $ | - | $ | 201 | $ | - | $ | - | $ | 201 | ||||||||||
Derivative liabilities | 12 | 194 | 11 | (124 | ) | 93 | ||||||||||||||
Total liabilities | $ | 12 | $ | 395 | $ | 11 | $ | (124 | ) | $ | 294 |
(1) | Amounts represent the impact of legally enforceable master netting agreements that allow CenterPoint Energy to settle positive and negative positions and also include cash collateral of $95 million posted with the same counterparties. |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Netting Adjustments (1) | Balance as of December 31, 2010 | ||||||||||||||||
(in millions) | ||||||||||||||||||||
Assets | ||||||||||||||||||||
Corporate equities | $ | 368 | $ | — | $ | — | $ | — | $ | 368 | ||||||||||
Investments, including money market funds | 54 | — | — | — | 54 | |||||||||||||||
Derivative assets | — | 73 | 7 | (11 | ) | 69 | ||||||||||||||
Total assets | $ | 422 | $ | 73 | $ | 7 | $ | (11 | ) | $ | 491 | |||||||||
Liabilities | ||||||||||||||||||||
Indexed debt securities derivative | $ | — | $ | 232 | $ | — | $ | — | $ | 232 | ||||||||||
Derivative liabilities | 8 | 167 | 4 | (95 | ) | 84 | ||||||||||||||
Total liabilities | $ | 8 | $ | 399 | $ | 4 | $ | (95 | ) | $ | 316 |
(1) | Amounts represent the impact of legally enforceable master netting agreements that allow CenterPoint Energy to settle positive and negative positions and also include cash collateral of $84 million posted with the same counterparties. |
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) | ||||||||
Derivative assets and liabilities, net | ||||||||
Year Ended December 31, | ||||||||
2008 | 2009 | |||||||
(in millions) | ||||||||
Beginning balance | $ | (3 | ) | $ | (58 | ) | ||
Total unrealized gains or (losses): | ||||||||
Included in earnings | (11 | ) | (1 | ) | ||||
Included in regulatory assets | (10 | ) | (16 | ) | ||||
Purchases, sales, other settlements, net | (35 | ) | 69 | (1) | ||||
Net transfers into Level 3 | 1 | - | ||||||
Ending balance | $ | (58 | ) | $ | (6 | ) | ||
The amount of total gains for the period included in earnings attributable to the change in unrealized gains or losses relating to assets still held at the reporting date | $ | 7 | $ | 1 |
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) | ||||||||||||
Derivative assets and liabilities, net | ||||||||||||
Year Ended December 31, | ||||||||||||
2008 | 2009 | 2010 | ||||||||||
(in millions) | ||||||||||||
Beginning balance | $ | (3 | ) | $ | (58 | ) | $ | (6 | ) | |||
Total unrealized gains or (losses): | ||||||||||||
Included in earnings | (11 | ) | (1 | ) | 4 | |||||||
Included in regulatory assets | (10 | ) | (16 | ) | (1 | ) | ||||||
Purchases, sales and other settlements, net: | ||||||||||||
Included in earnings | 6 | 3 | (2 | ) | ||||||||
Included in regulatory assets | (41 | ) | 66 | 8 | ||||||||
Net transfers into Level 3 | 1 | — | — | |||||||||
Ending balance | $ | (58 | ) | $ | (6 | ) | $ | 3 | ||||
The amount of total gains for the period included in earnings attributable to the change in unrealized gains or losses relating to assets still held at the reporting date | $ | 7 | $ | 1 | $ | 4 |
December 31, 2009 | December 31, 2010 | |||||||||||||||
Carrying Amount | Fair Value | Carrying Amount | Fair Value | |||||||||||||
(in millions) | ||||||||||||||||
Financial liabilities: | ||||||||||||||||
Long-term debt | $ | 9,900 | $ | 10,413 | $ | 9,303 | $ | 10,071 |
TW Securities | Debt Component of ZENS | Derivative Component of ZENS | ||||||||||
Balance at December 31, 2006 | $ | 471 | $ | 111 | $ | 372 | ||||||
Accretion of debt component of ZENS | - | 20 | - | |||||||||
2% interest paid | - | (17 | ) | - | ||||||||
Gain on indexed debt securities | - | - | (111 | ) | ||||||||
Loss on TW Common | (114 | ) | - | - | ||||||||
Balance at December 31, 2007 | 357 | 114 | 261 | |||||||||
Accretion of debt component of ZENS | - | 20 | - | |||||||||
2% interest paid | - | (17 | ) | - | ||||||||
Gain on indexed debt securities | - | - | (128 | ) | ||||||||
Loss on TW Common | (139 | ) | - | - | ||||||||
Balance at December 31, 2008 | 218 | 117 | 133 | |||||||||
Accretion of debt component of ZENS | - | 21 | - | |||||||||
2% interest paid | - | (17 | ) | - | ||||||||
Loss on indexed debt securities | - | - | 68 | |||||||||
Gain on TW Securities | 82 | - | - | |||||||||
Balance at December 31, 2009 | $ | 300 | $ | 121 | $ | 201 |
TW Securities | Debt Component of ZENS | Derivative Component of ZENS | ||||||||||
Balance at December 31, 2007 | $ | 357 | $ | 114 | $ | 261 | ||||||
Accretion of debt component of ZENS | — | 20 | — | |||||||||
2% interest paid | — | (17 | ) | — | ||||||||
Gain on indexed debt securities | — | — | (128 | ) | ||||||||
Loss on TW Common | (139 | ) | — | — | ||||||||
Balance at December 31, 2008 | 218 | 117 | 133 | |||||||||
Accretion of debt component of ZENS | — | 21 | — | |||||||||
2% interest paid | — | (17 | ) | — | ||||||||
Loss on indexed debt securities | — | — | 68 | |||||||||
Gain on TW Securities | 82 | — | — | |||||||||
Balance at December 31, 2009 | 300 | 121 | 201 | |||||||||
Accretion of debt component of ZENS | — | 22 | — | |||||||||
2% interest paid | — | (17 | ) | — | ||||||||
Loss on indexed debt securities | — | — | 31 | |||||||||
Gain on TW Securities | 67 | — | — | |||||||||
Balance at December 31, 2010 | $ | 367 | $ | 126 | $ | 232 |
December 31, 2008 | December 31, 2009 | December 31, 2009 | December 31, 2010 | |||||||||||||||||||||||||||||
Long-Term | Current(1) | Long-Term | Current(1) | Long-Term | Current(1) | Long-Term | Current(1) | |||||||||||||||||||||||||
(In millions) | (in millions) | |||||||||||||||||||||||||||||||
Short-term borrowings: | ||||||||||||||||||||||||||||||||
CERC Corp. receivables facility | $ | - | $ | 78 | $ | - | $ | - | ||||||||||||||||||||||||
Inventory financing | - | 75 | - | 55 | $ | — | $ | 55 | $ | — | $ | 53 | ||||||||||||||||||||
Total short-term borrowings | - | 153 | - | 55 | — | 55 | — | 53 | ||||||||||||||||||||||||
Long-term debt: | ||||||||||||||||||||||||||||||||
CenterPoint Energy: | ||||||||||||||||||||||||||||||||
ZENS(2) | - | 117 | - | 121 | — | 121 | — | 126 | ||||||||||||||||||||||||
Senior notes 5.95% to 7.25% due 2010 to 2018 | 950 | - | 750 | 200 | ||||||||||||||||||||||||||||
Senior notes 5.95% to 6.85% due 2015 to 2018 | 750 | 200 | 750 | — | ||||||||||||||||||||||||||||
Pollution control bonds 4.00% due 2015(3) | 151 | - | 151 | - | 151 | — | 151 | — | ||||||||||||||||||||||||
Pollution control bonds 4.70% to 8.00% due 2011 to 2030(4)(5) | 871 | - | 581 | 290 | ||||||||||||||||||||||||||||
Bank loans due 2012(6) | 264 | - | - | - | ||||||||||||||||||||||||||||
Pollution control bonds 4.70% to 5.95% due 2011 to 2030(4) | 581 | 290 | 562 | 19 | ||||||||||||||||||||||||||||
Other | 12 | 1 | - | 7 | — | 7 | — | — | ||||||||||||||||||||||||
CenterPoint Houston: | ||||||||||||||||||||||||||||||||
First mortgage bonds 9.15% due 2021 | 102 | - | 102 | - | 102 | — | 102 | — | ||||||||||||||||||||||||
General mortgage bonds 5.60% to 7.00% due 2013 to 2033 | 1,262 | - | 1,762 | - | 1,762 | — | 1,762 | — | ||||||||||||||||||||||||
Pollution control bonds 3.625% to 5.60% due 2012 to 2027(7) | 229 | - | 229 | - | ||||||||||||||||||||||||||||
System restoration bonds 1.833% to 4.243% due 2010 to 2022 | - | - | 645 | 20 | ||||||||||||||||||||||||||||
Transition Bonds 4.192% to 5.63% due 2010 to 2020 | 2,381 | 208 | 2,160 | 221 | ||||||||||||||||||||||||||||
Bank loans due 2012(6) | 251 | - | - | - | ||||||||||||||||||||||||||||
Pollution control bonds 3.625% to 5.60% due 2012 to 2027(5) | 229 | — | 229 | — | ||||||||||||||||||||||||||||
System restoration bonds 1.833% to 4.243% due 2011 to 2022 | 645 | 20 | 601 | 43 | ||||||||||||||||||||||||||||
Transition bonds 4.192% to 5.63% due 2011 to 2020 | 2,160 | 221 | 1,921 | 240 | ||||||||||||||||||||||||||||
CERC Corp.: | ||||||||||||||||||||||||||||||||
Convertible subordinated debentures 6.00% due 2012 (8) | 44 | 7 | - | 44 | ||||||||||||||||||||||||||||
Senior notes 5.95% to 7.875% due 2011 to 2037 | 2,747 | - | 2,747 | - | ||||||||||||||||||||||||||||
Bank loans due 2012(6) | 926 | - | - | - | ||||||||||||||||||||||||||||
Convertible subordinated debentures 6.00% due 2012 | — | 44 | — | — | ||||||||||||||||||||||||||||
Senior notes 5.95% to 7.875% due 2013 to 2037 (6) | 2,747 | — | 2,747 | — | ||||||||||||||||||||||||||||
Commercial paper (7) | — | — | 183 | — | ||||||||||||||||||||||||||||
Other | 1 | - | 1 | - | 1 | — | 1 | — | ||||||||||||||||||||||||
Unamortized discount and premium(9) | (10 | ) | - | (9 | ) | - | ||||||||||||||||||||||||||
Unamortized discount and premium | (9 | ) | — | (8 | ) | — | ||||||||||||||||||||||||||
Total long-term debt | 10,181 | 333 | 9,119 | 903 | 9,119 | 903 | 9,001 | 428 | ||||||||||||||||||||||||
Total debt | $ | 10,181 | $ | 486 | $ | 9,119 | $ | 958 | $ | 9,119 | $ | 958 | $ | 9,001 | $ | 481 |
(1) | Includes amounts due or exchangeable within one year of the date noted. |
(2) | CenterPoint Energy’s ZENS obligation is bifurcated into a debt component and an embedded derivative component. For additional information regarding ZENS, see Note |
(3) | These series of debt are secured by first mortgage bonds of CenterPoint Houston. |
(4) | $527 million and $237 million of these series of debt is secured by general mortgage bonds of CenterPoint |
(5) |
These series of debt are secured by general mortgage bonds of CenterPoint Houston. |
December 31, 2008 | December 31, 2009 | |||||||
CenterPoint Energy credit facility borrowings | $ | 264 | $ | - | ||||
CenterPoint Houston credit facility borrowings | 251 | - | ||||||
CERC Corp. credit facility borrowings | 926 | - | ||||||
Total credit facility borrowings | $ | 1,441 | $ | - |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
(In millions) | (in millions) | |||||||||||||||||||||||
Current income tax expense (benefit): | ||||||||||||||||||||||||
Federal | $ | 161 | $ | (221 | ) | $ | (103 | ) | $ | (221 | ) | $ | (103 | ) | $ | 40 | ||||||||
State | 32 | 11 | 10 | 11 | 10 | 24 | ||||||||||||||||||
Total current expense (benefit) | 193 | (210 | ) | (93 | ) | (210 | ) | (93 | ) | 64 | ||||||||||||||
Deferred income tax expense (benefit): | ||||||||||||||||||||||||
Federal | 47 | 437 | 251 | 437 | 251 | 220 | ||||||||||||||||||
State | (47 | ) | 50 | 18 | 50 | 18 | (21 | ) | ||||||||||||||||
Total deferred expense | - | 487 | 269 | 487 | 269 | 199 | ||||||||||||||||||
Total income tax expense | $ | 193 | $ | 277 | $ | 176 | $ | 277 | $ | 176 | $ | 263 |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
(In millions) | (in millions) | |||||||||||||||||||||||
Income before income taxes | $ | 588 | $ | 723 | $ | 548 | $ | 723 | $ | 548 | $ | 705 | ||||||||||||
Federal statutory income tax rate | 35 | % | 35 | % | 35 | % | 35 | % | 35 | % | 35 | % | ||||||||||||
Expected federal income tax expense | 206 | 253 | 192 | 253 | 192 | 247 | ||||||||||||||||||
Increase (decrease) in tax expense resulting from: | ||||||||||||||||||||||||
State income tax expense (benefit), net of federal income tax | (10 | ) | 40 | 18 | ||||||||||||||||||||
State income tax expense, net of federal income tax | 40 | 18 | 2 | |||||||||||||||||||||
Amortization of investment tax credit | (8 | ) | (7 | ) | (7 | ) | (7 | ) | (7 | ) | (7 | ) | ||||||||||||
Tax basis balance sheet adjustments | 25 | - | - | |||||||||||||||||||||
Tax law change in deductibility of retiree health care costs | — | — | 20 | |||||||||||||||||||||
Increase (decrease) in settled and uncertain income tax positions | (20 | ) | 8 | (5 | ) | 8 | (5 | ) | 14 | |||||||||||||||
Other, net | - | (17 | ) | (22 | ) | (17 | ) | (22 | ) | (13 | ) | |||||||||||||
Total | (13 | ) | 24 | (16 | ) | 24 | (16 | ) | 16 | |||||||||||||||
Total income tax expense | $ | 193 | $ | 277 | $ | 176 | $ | 277 | $ | 176 | $ | 263 | ||||||||||||
Effective tax rate | 32.8 | % | 38.4 | % | 32.1 | % | 38.4 | % | 32.1 | % | 37.3 | % |
December 31, | December 31, | |||||||||||||||
2008 | 2009 | 2009 | 2010 | |||||||||||||
(In millions) | (in millions) | |||||||||||||||
Deferred tax assets: | ||||||||||||||||
Current: | ||||||||||||||||
Allowance for doubtful accounts | $ | 15 | $ | 10 | $ | 10 | $ | 11 | ||||||||
Deferred gas costs | 13 | 7 | 7 | 32 | ||||||||||||
Other | 1 | - | — | 21 | ||||||||||||
Total current deferred tax assets | 29 | 17 | 17 | 64 | ||||||||||||
Non-current: | ||||||||||||||||
Loss and credit carryforwards | 36 | 42 | 42 | 49 | ||||||||||||
Employee benefits | 360 | 366 | 366 | 346 | ||||||||||||
Other | 57 | 51 | 51 | 48 | ||||||||||||
Total non-current deferred tax assets before valuation allowance | 453 | 459 | 459 | 443 | ||||||||||||
Valuation allowance | (5 | ) | (5 | ) | (5 | ) | (3 | ) | ||||||||
Total non-current deferred tax assets, net of valuation allowance | 448 | 454 | 454 | 440 | ||||||||||||
Total deferred tax assets, net of valuation allowance | 477 | 471 | 471 | 504 | ||||||||||||
Deferred tax liabilities: | ||||||||||||||||
Current: | ||||||||||||||||
Unrealized gain on indexed debt securities | $ | 373 | $ | 366 | $ | 366 | $ | 391 | ||||||||
Unrealized gain on TW securities | 28 | 57 | 57 | 80 | ||||||||||||
Total current deferred tax liabilities | 401 | 423 | 423 | 471 | ||||||||||||
Non-current: | ||||||||||||||||
Depreciation | 1,679 | 1,887 | 1,887 | 2,086 | ||||||||||||
Regulatory assets, net | 1,319 | 1,298 | 1,298 | 1,256 | ||||||||||||
Other | 58 | 45 | 45 | 32 | ||||||||||||
Total non-current deferred tax liabilities | 3,056 | 3,230 | 3,230 | 3,374 | ||||||||||||
Total deferred tax liabilities | 3,457 | 3,653 | 3,653 | 3,845 | ||||||||||||
Accumulated deferred income taxes, net | $ | 2,980 | $ | 3,182 | $ | 3,182 | $ | 3,341 |
December 31, | ||||||||||||
2008 | 2009 | 2010 | ||||||||||
(in millions) | ||||||||||||
Balance, beginning of year | $ | 82 | $ | 117 | $ | 187 | ||||||
Tax Positions related to prior years: | ||||||||||||
Additions | 20 | 56 | 9 | |||||||||
Reductions | (2 | ) | (25 | ) | (4 | ) | ||||||
Tax Positions related to current year: | ||||||||||||
Additions | 17 | 56 | 60 | |||||||||
Settlements | — | (17 | ) | — | ||||||||
Balance, end of year | $ | 117 | $ | 187 | $ | 252 |
December 31, | ||||||||||||
2007 | 2008 | 2009 | ||||||||||
(In millions) | ||||||||||||
Balance, beginning of year | $ | 72 | $ | 82 | $ | 117 | ||||||
Tax Positions related to prior years: | ||||||||||||
Additions | 28 | 20 | 56 | |||||||||
Reductions | (20 | ) | (2 | ) | (25 | ) | ||||||
Tax Positions related to current year: | ||||||||||||
Additions | 4 | 17 | 56 | |||||||||
Settlements | (2 | ) | — | (17 | ) | |||||||
Balance, end of year | $ | 82 | $ | 117 | $ | 187 |
2010 | $ | 12 | ||||||
2011 | 13 | $ | 15 | |||||
2012 | 9 | 12 | ||||||
2013 | 6 | 7 | ||||||
2014 | 4 | 6 | ||||||
2015 and beyond | 7 | |||||||
2015 | 4 | |||||||
2016 and beyond | 15 | |||||||
Total | $ | 51 | $ | 59 |
December 31, 2008 | December 31, 2009 | |||||||||||||||
Carrying Amount | Fair Value | Carrying Amount | Fair Value | |||||||||||||
(in millions) | ||||||||||||||||
Financial liabilities: | ||||||||||||||||
Long-term debt | $ | 10,396 | $ | 9,875 | $ | 9,900 | $ | 10,413 |
For the Year Ended December 31, | For the Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
(In millions, except per share and share amounts) | (in millions, except per share and share amounts) | |||||||||||||||||||||||
Basic earnings per share calculation: | ||||||||||||||||||||||||
Net income | $ | 395 | $ | 446 | $ | 372 | $ | 446 | $ | 372 | $ | 442 | ||||||||||||
Weighted average shares outstanding | 320,480,000 | 336,387,000 | 365,229,000 | 336,387,000 | 365,229,000 | 409,721,000 | ||||||||||||||||||
Basic earnings per share | $ | 1.23 | $ | 1.32 | $ | 1.02 | $ | 1.32 | $ | 1.02 | $ | 1.08 | ||||||||||||
Diluted earnings per share calculation: | ||||||||||||||||||||||||
Net income | $ | 395 | $ | 446 | $ | 372 | $ | 446 | $ | 372 | $ | 442 | ||||||||||||
Weighted average shares outstanding | 320,480,000 | 336,387,000 | 365,229,000 | 336,387,000 | 365,229,000 | 409,721,000 | ||||||||||||||||||
Plus: Incremental shares from assumed conversions: | ||||||||||||||||||||||||
Stock options(1) | 1,059,000 | 760,000 | 451,000 | 760,000 | 451,000 | 470,000 | ||||||||||||||||||
Restricted stock | 1,928,000 | 1,772,000 | 2,001,000 | 1,772,000 | 2,001,000 | 2,585,000 | ||||||||||||||||||
2.875% convertible senior notes | 291,000 | - | - | |||||||||||||||||||||
3.75% convertible senior notes | 18,749,000 | 4,636,000 | - | 4,636,000 | — | — | ||||||||||||||||||
Weighted average shares assuming dilution | 342,507,000 | 343,555,000 | 367,681,000 | 343,555,000 | 367,681,000 | 412,776,000 | ||||||||||||||||||
Diluted earnings per share | $ | 1.15 | $ | 1.30 | $ | 1.01 | $ | 1.30 | $ | 1.01 | $ | 1.07 |
(1) | Options to purchase |
Year Ended December 31, 2008 | Year Ended December 31, 2009 | |||||||||||||||||||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | First Quarter | Second Quarter | Third Quarter | Fourth Quarter | |||||||||||||||||||||||||
(In millions, except per share amounts) | (in millions, except per share amounts) | |||||||||||||||||||||||||||||||
Revenues | $ | 3,363 | $ | 2,670 | $ | 2,515 | $ | 2,774 | $ | 2,766 | $ | 1,640 | $ | 1,576 | $ | 2,299 | ||||||||||||||||
Operating income | 336 | 297 | 337 | 303 | 285 | 253 | 287 | 299 | ||||||||||||||||||||||||
Net income | 122 | 101 | 136 | 87 | 67 | 86 | 114 | 105 | ||||||||||||||||||||||||
Basic earnings per share(1) | $ | 0.37 | $ | 0.30 | $ | 0.40 | $ | 0.25 | $ | 0.19 | $ | 0.24 | $ | 0.31 | $ | 0.27 | ||||||||||||||||
Diluted earnings per share(1) | $ | 0.36 | $ | 0.30 | $ | 0.39 | $ | 0.25 | $ | 0.19 | $ | 0.24 | $ | 0.31 | $ | 0.27 |
Year Ended December 31, 2010 | ||||||||||||||||
First Quarter (2) | Second Quarter | Third Quarter | Fourth Quarter (3) | |||||||||||||
(in millions, except per share amounts) | ||||||||||||||||
Revenues | $ | 3,023 | $ | 1,756 | $ | 1,908 | $ | 2,098 | ||||||||
Operating income | 357 | 263 | 327 | 302 | ||||||||||||
Net income | 114 | 81 | 123 | 124 | ||||||||||||
Basic earnings per share(1) | $ | 0.29 | $ | 0.20 | $ | 0.29 | $ | 0.29 | ||||||||
Diluted earnings per share(1) | $ | 0.29 | $ | 0.20 | $ | 0.29 | $ | 0.29 |
Year Ended December 31, 2009 | ||||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | |||||||||||||
(In millions, except per share amounts) | ||||||||||||||||
Revenues | $ | 2,766 | $ | 1,640 | $ | 1,576 | $ | 2,299 | ||||||||
Operating income | 285 | 253 | 287 | 299 | ||||||||||||
Net income | 67 | 86 | 114 | 105 | ||||||||||||
Basic earnings per share(1) | $ | 0.19 | $ | 0.24 | $ | 0.31 | $ | 0.27 | ||||||||
Diluted earnings per share(1) | $ | 0.19 | $ | 0.24 | $ | 0.31 | $ | 0.27 |
(1) | Quarterly earnings per common share are based on the weighted average number of shares outstanding during the quarter, and the sum of the quarters may not equal annual earnings per common share. |
(2) | During the first quarter of 2010, CenterPoint Energy recorded a $21 million charge to income tax expense as a result of a change in tax law upon the enactment in March 2010 of the Patient Protection and Affordable Care Act and the related Health Care and Education Reconciliation Act of 2010. |
(3) | During the fourth quarter of 2010, CenterPoint Energy recorded a $21 million gain on the sale of non-strategic gathering assets by its Field Services business segment. CenterPoint Energy also recorded a $24 million decrease in income tax expense related to the effects of re-measuring accumulated deferred income taxes associated with the restructuring of certain subsidiaries. |
Revenues from External Customers | Intersegment Revenues | Depreciation and Amortization | Operating Income | Total Assets | Expenditures for Long-Lived Assets | |||||||||||||||||||
As of and for the year ended December 31, 2008: | ||||||||||||||||||||||||
Electric Transmission & Distribution | $ | 1,916 | (1) | $ | — | $ | 460 | $ | 545 | $ | 8,880 | $ | 481 | (5) | ||||||||||
Natural Gas Distribution | 4,217 | 9 | 157 | 215 | 4,961 | 214 | ||||||||||||||||||
Competitive Natural Gas Sales and Services | 4,488 | 40 | 3 | 62 | 1,315 | 8 | ||||||||||||||||||
Interstate Pipelines(2) | 477 | 173 | 46 | 293 | 3,578 | 189 | ||||||||||||||||||
Field Services(3) | 213 | 39 | 12 | 147 | 826 | 122 | ||||||||||||||||||
Other | 11 | — | 30 | 11 | 2,185 | (4) | 39 | |||||||||||||||||
Reconciling Eliminations | — | (261 | ) | — | — | (2,069 | ) | — | ||||||||||||||||
Consolidated | $ | 11,322 | $ | — | $ | 708 | $ | 1,273 | $ | 19,676 | $ | 1,053 | ||||||||||||
As of and for the year ended December 31, 2009: | ||||||||||||||||||||||||
Electric Transmission & Distribution | $ | 2,013 | (1) | $ | — | $ | 480 | $ | 545 | $ | 9,755 | $ | 428 | (5) | ||||||||||
Natural Gas Distribution | 3,374 | 10 | 161 | 204 | 4,535 | 165 | ||||||||||||||||||
Competitive Natural Gas Sales and Services | 2,215 | 15 | 4 | 21 | 1,176 | 2 | ||||||||||||||||||
Interstate Pipelines(2) | 456 | 142 | 48 | 256 | 3,484 | 176 | ||||||||||||||||||
Field Services(3) | 212 | 29 | 15 | 94 | 1,045 | 348 | ||||||||||||||||||
Other | 11 | — | 35 | 4 | 2,261 | (4) | 29 | |||||||||||||||||
Reconciling Eliminations | — | (196 | ) | — | — | (2,483 | ) | — | ||||||||||||||||
Consolidated | $ | 8,281 | $ | — | $ | 743 | $ | 1,124 | $ | 19,773 | $ | 1,148 | ||||||||||||
As of and for the year ended December 31, 2010: | ||||||||||||||||||||||||
Electric Transmission & Distribution | $ | 2,205 | (1) | $ | — | $ | 582 | $ | 567 | $ | 9,817 | $ | 463 | |||||||||||
Natural Gas Distribution | 3,199 | 14 | 166 | 231 | 4,575 | 202 | ||||||||||||||||||
Competitive Natural Gas Sales and Services | 2,617 | 34 | 4 | 16 | 1,190 | 2 | ||||||||||||||||||
Interstate Pipelines(2) | 464 | 137 | 52 | 270 | 3,672 | 102 | ||||||||||||||||||
Field Services(3) | 289 | 49 | 25 | 151 | 1,803 | 668 | ||||||||||||||||||
Other | 11 | — | 35 | 14 | 2,184 | (4) | 25 | |||||||||||||||||
Reconciling Eliminations | — | (234 | ) | — | — | (3,130 | ) | — | ||||||||||||||||
Consolidated | $ | 8,785 | $ | — | $ | 864 | $ | 1,249 | $ | 20,111 | $ | 1,462 |
Revenues from External Customers | Intersegment Revenues | Depreciation and Amortization | Operating Income (Loss) | Total Assets | Expenditures for Long-Lived Assets | |||||||||||||||||||
As of and for the year ended December 31, 2007: | ||||||||||||||||||||||||
Electric Transmission & Distribution | $ | 1,837 | (1) | $ | - | $ | 398 | $ | 561 | $ | 8,358 | $ | 401 | |||||||||||
Natural Gas Distribution | 3,749 | 10 | 155 | 218 | 4,332 | 191 | ||||||||||||||||||
Competitive Natural Gas Sales and Services | 3,534 | 45 | 5 | 75 | 1,221 | 7 | ||||||||||||||||||
Interstate Pipelines(2) | 357 | 143 | 44 | 237 | 3,007 | 308 | ||||||||||||||||||
Field Services(3) | 136 | 39 | 11 | 99 | 669 | 74 | ||||||||||||||||||
Other | 10 | - | 18 | (5 | ) | 1,956 | (4) | 30 | ||||||||||||||||
Reconciling Eliminations | - | (237 | ) | - | - | (1,671 | ) | - | ||||||||||||||||
Consolidated | $ | 9,623 | $ | - | $ | 631 | $ | 1,185 | $ | 17,872 | $ | 1,011 | ||||||||||||
As of and for the year ended December 31, 2008: | ||||||||||||||||||||||||
Electric Transmission & Distribution | $ | 1,916 | (1) | $ | - | $ | 460 | $ | 545 | $ | 8,880 | $ | 481 | (5) | ||||||||||
Natural Gas Distribution | 4,217 | 9 | 157 | 215 | 4,961 | 214 | ||||||||||||||||||
Competitive Natural Gas Sales and Services | 4,488 | 40 | 3 | 62 | 1,315 | 8 | ||||||||||||||||||
Interstate Pipelines(2) | 477 | 173 | 46 | 293 | 3,578 | 189 | ||||||||||||||||||
Field Services(3) | 213 | 39 | 12 | 147 | 826 | 122 | ||||||||||||||||||
Other | 11 | - | 30 | 11 | 2,185 | (4) | 39 | |||||||||||||||||
Reconciling Eliminations | - | (261 | ) | - | - | (2,069 | ) | - | ||||||||||||||||
Consolidated | $ | 11,322 | $ | - | $ | 708 | $ | 1,273 | $ | 19,676 | $ | 1,053 | ||||||||||||
As of and for the year ended December 31, 2009: | ||||||||||||||||||||||||
Electric Transmission & Distribution | $ | 2,013 | (1) | $ | - | $ | 480 | $ | 545 | $ | 9,755 | $ | 428 | (5) | ||||||||||
Natural Gas Distribution | 3,374 | 10 | 161 | 204 | 4,535 | 165 | ||||||||||||||||||
Competitive Natural Gas Sales and Services | 2,215 | 15 | 4 | 21 | 1,176 | 2 | ||||||||||||||||||
Interstate Pipelines(2) | 456 | 142 | 48 | 256 | 3,484 | 176 | ||||||||||||||||||
Field Services(3) | 212 | 29 | 15 | 94 | 1,045 | 348 | ||||||||||||||||||
Other | 11 | - | 35 | 4 | 2,261 | (4) | 29 | |||||||||||||||||
Reconciling Eliminations | - | (196 | ) | - | - | (2,483 | ) | - | ||||||||||||||||
Consolidated | $ | 8,281 | $ | - | $ | 743 | $ | 1,124 | $ | 19,773 | $ | 1,148 |
(1) | Sales to subsidiaries of NRG Retail LLC, the successor to RRI’s Texas retail business, in |
(2) | Interstate Pipelines recorded equity income of |
(3) | Field Services recorded equity income of |
$38 million, |
(4) | Included in total assets of Other Operations as of December 31, |
(5) | Included in expenditures for long-lived assets of Electric Transmission & Distribution is $145 million and $26 million for 2008 and 2009, respectively, related to Hurricane Ike. |
Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||
Revenues by Products and Services: | 2007 | 2008 | 2009 | 2008 | 2009 | 2010 | ||||||||||||||||||
(In millions) | (in millions) | |||||||||||||||||||||||
Electric delivery sales | $ | 1,837 | $ | 1,916 | $ | 2,013 | $ | 1,916 | $ | 2,013 | $ | 2,205 | ||||||||||||
Retail gas sales | 4,941 | 6,216 | 4,540 | 6,216 | 4,540 | 4,412 | ||||||||||||||||||
Wholesale gas sales | 2,196 | 2,295 | 902 | 2,295 | 902 | 1,250 | ||||||||||||||||||
Gas transport | 532 | 756 | 691 | 756 | 691 | 785 | ||||||||||||||||||
Energy products and services | 117 | 139 | 135 | 139 | 135 | 133 | ||||||||||||||||||
Total | $ | 9,623 | $ | 11,322 | $ | 8,281 | $ | 11,322 | $ | 8,281 | $ | 8,785 |
2010 | |
2010 | |
Report of Independent Registered Public Accounting Firm | |
For the Year Ended December 31, | For the Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
(In millions) | (in millions) | |||||||||||||||||||||||
Expenses: | ||||||||||||||||||||||||
Operation and Maintenance Expenses | $ | (17 | ) | $ | (12 | ) | $ | (17 | ) | $ | (12 | ) | $ | (17 | ) | $ | (12 | ) | ||||||
Taxes Other than Income | (4 | ) | 1 | - | 1 | — | — | |||||||||||||||||
Total | (21 | ) | (11 | ) | (17 | ) | (11 | ) | (17 | ) | (12 | ) | ||||||||||||
Other Income (Expense): | ||||||||||||||||||||||||
Interest Income from Subsidiaries | 22 | 12 | 8 | 12 | 8 | 8 | ||||||||||||||||||
Other Income (Expense) | 1 | (5 | ) | (2 | ) | |||||||||||||||||||
Other Expense | (5 | ) | (5 | ) | (8 | ) | ||||||||||||||||||
Gain (Loss) on Indexed Debt Securities | 111 | 128 | (68 | ) | 128 | (68 | ) | (31 | ) | |||||||||||||||
Interest Expense to Subsidiaries | (67 | ) | (38 | ) | (25 | ) | (38 | ) | (25 | ) | (26 | ) | ||||||||||||
Interest Expense | (225 | ) | (162 | ) | (149 | ) | (162 | ) | (149 | ) | (132 | ) | ||||||||||||
Distribution to ZENS Holders | (27 | ) | - | (3 | ) | |||||||||||||||||||
Total | (185 | ) | (65 | ) | (239 | ) | (65 | ) | (239 | ) | (189 | ) | ||||||||||||
Loss Before Income Taxes | (206 | ) | (76 | ) | (256 | ) | (76 | ) | (256 | ) | (201 | ) | ||||||||||||
Income Tax Benefit | 86 | 32 | 113 | 32 | 113 | 79 | ||||||||||||||||||
Loss Before Equity in Subsidiaries | (120 | ) | (44 | ) | (143 | ) | (44 | ) | (143 | ) | (122 | ) | ||||||||||||
Equity Income of Subsidiaries | 515 | 490 | 515 | 490 | 515 | 564 | ||||||||||||||||||
Net Income | $ | 395 | $ | 446 | $ | 372 | $ | 446 | $ | 372 | $ | 442 |
December 31, | December 31, | |||||||||||||||
2008 | 2009 | 2009 | 2010 | |||||||||||||
(In millions) | (in millions) | |||||||||||||||
ASSETS | ||||||||||||||||
Current Assets: | ||||||||||||||||
Cash and cash equivalents | $ | - | $ | - | $ | — | $ | — | ||||||||
Notes receivable - subsidiaries | 82 | 493 | ||||||||||||||
Accounts receivable - subsidiaries | 53 | 72 | ||||||||||||||
Notes receivable — subsidiaries | 493 | 530 | ||||||||||||||
Accounts receivable — subsidiaries | 72 | 59 | ||||||||||||||
Other assets | - | 16 | 16 | 68 | ||||||||||||
Total current assets | 135 | 581 | 581 | 657 | ||||||||||||
Other Assets: | ||||||||||||||||
Investment in subsidiaries | 5,161 | 5,562 | 5,562 | 6,115 | ||||||||||||
Notes receivable - subsidiaries | 151 | 151 | ||||||||||||||
Notes receivable — subsidiaries | 151 | 151 | ||||||||||||||
Other assets | 826 | 751 | 751 | 723 | ||||||||||||
Total other assets | 6,138 | 6,464 | 6,464 | 6,989 | ||||||||||||
Total Assets | $ | 6,273 | $ | 7,045 | $ | 7,045 | $ | 7,646 | ||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||||||
Current Liabilities: | ||||||||||||||||
Notes payable - subsidiaries | $ | 21 | $ | 306 | ||||||||||||
Current portion of long-term debt | 117 | 611 | ||||||||||||||
Notes payable — subsidiaries | $ | 306 | $ | 900 | ||||||||||||
Current portion of indexed debt | 121 | 126 | ||||||||||||||
Current portion of other long-term debt | 490 | 19 | ||||||||||||||
Indexed debt securities derivative | 133 | 201 | 201 | 232 | ||||||||||||
Accounts payable: | ||||||||||||||||
Subsidiaries | 40 | 17 | 17 | 27 | ||||||||||||
Other | 3 | 40 | 40 | 1 | ||||||||||||
Taxes accrued | 338 | 416 | 416 | 318 | ||||||||||||
Interest accrued | 26 | 29 | 29 | 19 | ||||||||||||
Other | 18 | 1 | 1 | 1 | ||||||||||||
Total current liabilities | 696 | 1,621 | 1,621 | 1,643 | ||||||||||||
Other Liabilities: | ||||||||||||||||
Accumulated deferred tax liabilities | 138 | 122 | 122 | 124 | ||||||||||||
Benefit obligations | 426 | 426 | 426 | 460 | ||||||||||||
Notes payable - subsidiaries | 750 | 750 | ||||||||||||||
Notes payable — subsidiaries | 750 | 750 | ||||||||||||||
Other | 7 | 7 | 7 | 10 | ||||||||||||
Total non-current liabilities | 1,321 | 1,305 | 1,305 | 1,344 | ||||||||||||
Long-Term Debt | 2,234 | 1,480 | 1,480 | 1,461 | ||||||||||||
Shareholders’ Equity: | ||||||||||||||||
Common stock | 3 | 4 | 4 | 4 | ||||||||||||
Additional paid-in capital | 3,158 | 3,671 | 3,671 | 4,100 | ||||||||||||
Accumulated deficit | (1,008 | ) | (912 | ) | (912 | ) | (789 | ) | ||||||||
Accumulated other comprehensive loss | (131 | ) | (124 | ) | (124 | ) | (117 | ) | ||||||||
Total shareholders’ equity | 2,022 | 2,639 | 2,639 | 3,198 | ||||||||||||
Total Liabilities and Shareholders’ Equity | $ | 6,273 | $ | 7,045 | $ | 7,045 | $ | 7,646 |
For the Year Ended December 31, | For the Year Ended December 31, | |||||||||||||||||||||||
2007 | 2008 | 2009 | 2008 | 2009 | 2010 | |||||||||||||||||||
(In millions) | (in millions) | |||||||||||||||||||||||
Operating Activities: | ||||||||||||||||||||||||
Net income | $ | 395 | $ | 446 | $ | 372 | $ | 446 | $ | 372 | $ | 442 | ||||||||||||
Non-cash items included in net income: | ||||||||||||||||||||||||
Equity income of subsidiaries | (515 | ) | (490 | ) | (515 | ) | (490 | ) | (515 | ) | (564 | ) | ||||||||||||
Deferred income tax expense | 52 | 90 | (19 | ) | 90 | (19 | ) | (16 | ) | |||||||||||||||
Amortization of debt issuance costs | 50 | 7 | 5 | 7 | 5 | 6 | ||||||||||||||||||
Loss (gain) on indexed debt securities | (111 | ) | (128 | ) | 68 | (128 | ) | 68 | 31 | |||||||||||||||
Changes in working capital: | ||||||||||||||||||||||||
Accounts receivable/(payable) from subsidiaries, net | 20 | (65 | ) | 86 | (65 | ) | 86 | 78 | ||||||||||||||||
Accounts payable | 11 | - | 14 | — | 14 | (16 | ) | |||||||||||||||||
Other current assets | - | 2 | (16 | ) | 2 | (16 | ) | (27 | ) | |||||||||||||||
Other current liabilities | (50 | ) | (111 | ) | 59 | (111 | ) | 59 | (111 | ) | ||||||||||||||
Common stock dividends received from subsidiaries | 240 | 746 | 109 | 746 | 109 | 9 | ||||||||||||||||||
Other | 2 | (7 | ) | (1 | ) | (7 | ) | (1 | ) | 6 | ||||||||||||||
Net cash provided by operating activities | 94 | 490 | 162 | |||||||||||||||||||||
Net cash provided by (used in) operating activities | 490 | 162 | (162 | ) | ||||||||||||||||||||
Investing Activities: | ||||||||||||||||||||||||
Short-term notes receivable from subsidiaries | 175 | 134 | (411 | ) | 134 | (411 | ) | (37 | ) | |||||||||||||||
Net cash provided by (used in) investing activities | 175 | 134 | (411 | ) | 134 | (411 | ) | (37 | ) | |||||||||||||||
Financing Activities: | ||||||||||||||||||||||||
Revolving credit facility, net | 131 | 133 | (264 | ) | 133 | (264 | ) | — | ||||||||||||||||
Proceeds from long-term debt | 250 | 300 | - | 300 | — | — | ||||||||||||||||||
Payments on long-term debt | (295 | ) | (907 | ) | - | (907 | ) | — | (490 | ) | ||||||||||||||
Debt issuance costs | (2 | ) | (4 | ) | - | (4 | ) | — | (2 | ) | ||||||||||||||
Common stock dividends paid | (218 | ) | (246 | ) | (276 | ) | (246 | ) | (276 | ) | (319 | ) | ||||||||||||
Proceeds from issuance of common stock, net | 22 | 80 | 504 | 80 | 504 | 416 | ||||||||||||||||||
Short-term notes payable to subsidiaries | (157 | ) | 20 | 285 | 20 | 285 | 594 | |||||||||||||||||
Net cash provided by (used in) financing activities | (269 | ) | (624 | ) | 249 | (624 | ) | 249 | 199 | |||||||||||||||
Net Decrease in Cash and Cash Equivalents | - | - | - | — | — | — | ||||||||||||||||||
Cash and Cash Equivalents at Beginning of Year | - | - | - | — | — | — | ||||||||||||||||||
Cash and Cash Equivalents at End of Year | $ | - | $ | - | $ | - | $ | — | $ | — | $ | — |
Column A | Column B | Column C | Column D | Column E | ||||||||||||||||
Description | Balance at Beginning of Period | Additions | Deductions From Reserves (2) | Balance at End of Period | ||||||||||||||||
Charged to Income | Charged to Other Accounts | |||||||||||||||||||
(In millions) | ||||||||||||||||||||
Year Ended December 31, 2009: | ||||||||||||||||||||
Accumulated provisions: | ||||||||||||||||||||
Uncollectible accounts receivable | $ | 35 | $ | 36 | $ | - | $ | 47 | $ | 24 | ||||||||||
Deferred tax asset valuation allowance | 5 | - | - | - | 5 | |||||||||||||||
Year Ended December 31, 2008: | ||||||||||||||||||||
Accumulated provisions: | ||||||||||||||||||||
Uncollectible accounts receivable | $ | 38 | $ | 54 | $ | 3 | $ | 60 | $ | 35 | ||||||||||
Deferred tax asset valuation allowance | 18 | (1 | ) | (12 | ) (1) | - | 5 | |||||||||||||
Year Ended December 31, 2007: | ||||||||||||||||||||
Accumulated provisions: | ||||||||||||||||||||
Uncollectible accounts receivable | $ | 33 | $ | 45 | $ | - | $ | 40 | $ | 38 | ||||||||||
Deferred tax asset valuation allowance | 22 | (4 | ) | - | - | 18 |
Column A | Column B | Column C | Column D | Column E | ||||||||||||||||
Additions | ||||||||||||||||||||
Balance at Beginning of Period | Charged to Income | Charged to Other Accounts | Deductions From Reserves (2) | Balance at End of Period | ||||||||||||||||
Description | (in millions) | |||||||||||||||||||
Year Ended December 31, 2010: | ||||||||||||||||||||
Accumulated provisions: | ||||||||||||||||||||
Uncollectible accounts receivable | $ | 24 | $ | 30 | $ | — | $ | 29 | $ | 25 | ||||||||||
Deferred tax asset valuation allowance | 5 | (2 | ) | — | — | 3 | ||||||||||||||
Year Ended December 31, 2009: | ||||||||||||||||||||
Accumulated provisions: | ||||||||||||||||||||
Uncollectible accounts receivable | $ | 35 | $ | 36 | $ | — | $ | 47 | $ | 24 | ||||||||||
Deferred tax asset valuation allowance | 5 | — | — | — | 5 | |||||||||||||||
Year Ended December 31, 2008: | ||||||||||||||||||||
Accumulated provisions: | ||||||||||||||||||||
Uncollectible accounts receivable | $ | 38 | $ | 54 | $ | 3 | $ | 60 | $ | 35 | ||||||||||
Deferred tax asset valuation allowance | 18 | (1 | ) | (12 | ) (1) | — | 5 |
(1) | The 2008 change to the deferred tax asset valuation allowance charged to other accounts represents a reduction equal to the related deferred tax asset reduction in 2008 for |
(2) | Deductions from reserves represent losses or expenses for which the respective reserves were created. In the case of the uncollectible accounts reserve, such deductions are net of recoveries of amounts previously written off. |
CENTERPOINT ENERGY, INC. | |
(Registrant) | |
By: /s/ David M. McClanahan | |
David M. McClanahan | |
President and Chief Executive Officer |
Signature | Title | |
/s/ DAVID M. MCCLANAHAN | President, Chief Executive Officer and | |
David M. McClanahan | Director (Principal Executive Officer and Director) | |
/s/ GARY L. WHITLOCK | Executive Vice President and Chief | |
Gary L. Whitlock | Financial Officer (Principal Financial Officer) | |
/s/ WALTER L. FITZGERALD | Senior Vice President and Chief | |
Walter L. Fitzgerald | Accounting Officer (Principal Accounting Officer) | |
/s/ MILTON CARROLL | Chairman of the Board of Directors | |
Milton Carroll | ||
/s/ DONALD R. CAMPBELL | Director | |
Donald R. Campbell | ||
/s/ DERRILL CODY | Director | |
Derrill Cody | ||
/s/ O. HOLCOMBE CROSSWELL | Director | |
O. Holcombe Crosswell | ||
/s/ MICHAEL P. JOHNSON | Director | |
Michael P. Johnson | ||
/s/ JANIECE M. LONGORIA | Director | |
Janiece M. Longoria | ||
/s/ THOMAS F. MADISON | Director | |
Thomas F. Madison | ||
/s/ ROBERT T. O’CONNELL | Director | |
Robert T. O’Connell | ||
/s/ SUSAN O. RHENEY | Director | |
Susan O. Rheney | ||
/s/ R. A. WALKER | Director | |
/s/ PETER S. WAREING | Director | |
Peter S. Wareing | ||
/s/ SHERMAN M. WOLFF | Director | |
Sherman M. Wolff | ||
Exhibit Number | Description | Report or Registration Statement | SEC File or Registration Number | Exhibit Reference | ||||
2 | - | Transaction Agreement dated July 21, 2004 among CenterPoint Energy, Utility Holding, LLC, NN Houston Sub, Inc., Texas Genco Holdings, Inc. ("Texas Genco"), HPC Merger Sub, Inc. and GC Power Acquisition LLC | CenterPoint Energy’s Form 8-K dated July 21, 2004 | 1-31447 | 10.1 | |||
3(a) | - | Restated Articles of Incorporation of CenterPoint Energy | CenterPoint Energy’s Form 8-K dated July 24, 2008 | 1-31447 | 3.2 | |||
3(b) | - | Amended and Restated Bylaws of CenterPoint Energy | CenterPoint Energy’s Form 8-K dated January 20, 2010 | 1-31447 | 3.1 | |||
4(a) | - | Form of CenterPoint Energy Stock Certificate | CenterPoint Energy’s Registration Statement on Form S-4 | 333-69502 | 4.1 | |||
4(b) | - | Rights Agreement dated January 1, 2002, between CenterPoint Energy and JPMorgan Chase Bank, as Rights Agent | CenterPoint Energy’s Form 10-K for the year ended December 31, 2001 | 1-31447 | 4.2 | |||
4(c) | - | Contribution and Registration Agreement dated December 18, 2001 among Reliant Energy, CenterPoint Energy and the Northern Trust Company, trustee under the Reliant Energy, Incorporated Master Retirement Trust | CenterPoint Energy’s Form 10-K for the year ended December 31, 2001 | 1-31447 | 4.3 | |||
4(d)(1) | - | Mortgage and Deed of Trust, dated November 1, 1944 between Houston Lighting and Power Company ("HL&P") and Chase Bank of Texas, National Association (formerly, South Texas Commercial National Bank of Houston), as Trustee, as amended and supplemented by 20 Supplemental Indentures thereto | HL&P’s Form S-7 filed on August 25, 1977 | 2-59748 | 2(b) |
Exhibit Number | Description | Report or Registration Statement | SEC File or Registration Number | Exhibit Reference | ||||
2 | — | Transaction Agreement dated July 21, 2004 among CenterPoint Energy, Utility Holding, LLC, NN Houston Sub, Inc., Texas Genco Holdings, Inc. (“Texas Genco”), HPC Merger Sub, Inc. and GC Power Acquisition LLC | CenterPoint Energy’s Form 8-K dated July 21, 2004 | 1-31447 | 10.1 | |||
3(a) | — | Restated Articles of Incorporation of CenterPoint Energy | CenterPoint Energy’s Form 8-K dated July 24, 2008 | 1-31447 | 3.2 | |||
†3(b) | — | Amended and Restated Bylaws of CenterPoint Energy | ||||||
4(a) | — | Form of CenterPoint Energy Stock Certificate | CenterPoint Energy’s Registration Statement on Form S-4 | 333-69502 | 4.1 | |||
4(b) | — | Rights Agreement dated January 1, 2002, between CenterPoint Energy and JPMorgan Chase Bank, as Rights Agent | CenterPoint Energy’s Form 10-K for the year ended December 31, 2001 | 1-31447 | 4.2 | |||
4(c) | — | Contribution and Registration Agreement dated December 18, 2001 among Reliant Energy, CenterPoint Energy and the Northern Trust Company, trustee under the Reliant Energy, Incorporated Master Retirement Trust | CenterPoint Energy’s Form 10-K for the year ended December 31, 2001 | 1-31447 | 4.3 | |||
4(d)(1) | — | Mortgage and Deed of Trust, dated November 1, 1944 between Houston Lighting and Power Company (“HL&P”) and Chase Bank of Texas, National Association (formerly, South Texas Commercial National Bank of Houston), as Trustee, as amended and supplemented by 20 Supplemental Indentures thereto | HL&P’s Form S-7 filed on August 25, 1977 | 2-59748 | 2(b) |
4(d)(2) | Twenty-First through Fiftieth Supplemental Indentures to Exhibit 4(d)(1) | HL&P’s Form 10-K for the year ended December 31, 1989 | 1-3187 | 4(a)(2) | ||||
4(d)(3) | Fifty-First Supplemental Indenture to Exhibit 4(d)(1) dated as of March 25, 1991 | HL&P’s Form 10-Q for the quarter ended June 30, 1991 | 1-3187 | 4(a) | ||||
4(d)(4) | Fifty-Second through Fifty-Fifth Supplemental Indentures to Exhibit 4(d)(1) each dated as of March 1, 1992 | HL&P’s Form 10-Q for the quarter ended March 31, 1992 | 1-3187 | 4 | ||||
4(d)(5) | Fifty-Sixth and Fifty-Seventh Supplemental Indentures to Exhibit 4(d)(1) each dated as of October 1, 1992 | HL&P’s Form 10-Q for the quarter ended September 30, 1992 | 1-3187 | 4 | ||||
4(d)(6) | Fifty-Eighth and Fifty-Ninth Supplemental Indentures to Exhibit 4(d)(1) each dated as of March 1, 1993 | HL&P’s Form 10-Q for the quarter ended March 31, 1993 | 1-3187 | 4 | ||||
4(d)(7) | Sixtieth Supplemental Indenture to Exhibit 4(d)(1) dated as of July 1, 1993 | HL&P’s Form 10-Q for the quarter ended June 30, 1993 | 1-3187 | 4 | ||||
4(d)(8) | Sixty-First through Sixty-Third Supplemental Indentures to Exhibit 4(d)(1) each dated as of December 1, 1993 | HL&P’s Form 10-K for the year ended December 31, 1993 | 1-3187 | 4(a)(8) | ||||
4(d)(9) | Sixty-Fourth and Sixty-Fifth Supplemental Indentures to Exhibit 4(d)(1) each dated as of July 1, 1995 | HL&P’s Form 10-K for the year ended December 31, 1995 | 1-3187 | 4(a)(9) | ||||
4(e)(1) | General Mortgage Indenture, dated as of October 10, 2002, between CenterPoint Energy Houston Electric, LLC and JPMorgan Chase Bank, as Trustee | CenterPoint Houston’s Form 10-Q for the quarter ended September 30, 2002 | 1-3187 | 4(j)(1) | ||||
4(e)(2) | Second Supplemental Indenture to Exhibit 4(e)(1), dated as of October 10, 2002 | CenterPoint Houston’s Form 10- Q for the quarter ended September 30, 2002 | 1-3187 | 4(j)(3) | ||||
4(e)(3) | Third Supplemental Indenture to Exhibit 4(e)(1), dated as of October 10, 2002 | CenterPoint Houston’s Form 10-Q for the quarter ended September 30, 2002 | 1-3187 | 4(j)(4) | ||||
4(e)(4) | Fourth Supplemental Indenture to Exhibit 4(e)(1), dated as of October 10, 2002 | CenterPoint Houston’s Form 10- Q for the quarter ended September 30, 2002 | 1-3187 | 4(j)(5) | ||||
4(e)(5) | Fifth Supplemental Indenture to Exhibit 4(e)(1), dated as of October 10, 2002 | CenterPoint Houston’s Form 10-Q for the quarter ended September 30, 2002 | 1-3187 | 4(j)(6) | ||||
4(e)(6) | Sixth Supplemental Indenture to Exhibit 4(e)(1), dated as of October 10, 2002 | CenterPoint Houston’s Form 10-Q for the quarter ended September 30, 2002 | 1-3187 | 4(j)(7) |
4(e)(7) | Seventh Supplemental Indenture to Exhibit 4(e)(1), dated as of October 10, 2002 | CenterPoint Houston’s Form 10-Q for the quarter ended September 30, 2002 | 1-3187 | 4(j)(8) | ||||
4(e)(8) | Eighth Supplemental Indenture to Exhibit 4(e)(1), dated as of October 10, 2002 | CenterPoint Houston’s Form 10-Q for the quarter ended September 30, 2002 | 1-3187 | 4(j)(9) | ||||
4(e)(9) | Officer’s Certificates dated October 10, 2002 setting forth the form, terms and provisions of the First through Eighth Series of General Mortgage Bonds | CenterPoint Energy’s Form 10-K for the year ended December 31, 2003 | 1-31447 | 4(e)(10) | ||||
4(e)(10) | Ninth Supplemental Indenture to Exhibit 4(e)(1), dated as of November 12, 2002 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2002 | 1-31447 | 4(e)(10) | ||||
4(e)(11) | Officer’s Certificate dated November 12, 2003 setting forth the form, terms and provisions of the Ninth Series of General Mortgage Bonds | CenterPoint Energy’s Form 10-K for the year ended December 31, 2003 | 1-31447 | 4(e)(12) | ||||
4(e)(12) | Tenth Supplemental Indenture to Exhibit 4(e)(1), dated as of March 18, 2003 | CenterPoint Energy’s Form 8-K dated March 13, 2003 | 1-31447 | 4.1 | ||||
4(e)(13) | Officer’s Certificate dated March 18, 2003 setting forth the form, terms and provisions of the Tenth Series and Eleventh Series of General Mortgage Bonds | CenterPoint Energy’s Form 8-K dated March 13, 2003 | 1-31447 | 4.2 | ||||
4(e)(14) | Eleventh Supplemental Indenture to Exhibit 4(e)(1), dated as of May 23, 2003 | CenterPoint Energy’s Form 8-K dated May 16, 2003 | 1-31447 | 4.2 | ||||
4(e)(15) | Officer’s Certificate dated May 23, 2003 setting forth the form, terms and provisions of the Twelfth Series of General Mortgage Bonds | CenterPoint Energy’s Form 8-K dated May 16, 2003 | 1-31447 | 4.1 | ||||
4(e)(16) | Twelfth Supplemental Indenture to Exhibit 4(e)(1), dated as of September 9, 2003 | CenterPoint Energy’s Form 8-K dated September 9, 2003 | 1-31447 | 4.2 | ||||
4(e)(17) | Officer’s Certificate dated September 9, 2003 setting forth the form, terms and provisions of the Thirteenth Series of General Mortgage Bonds | CenterPoint Energy’s Form 8-K dated September 9, 2003 | 1-31447 | 4.3 | ||||
4(e)(18) | Thirteenth Supplemental Indenture to Exhibit 4(e)(1), dated as of February 6, 2004 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2005 | 1-31447 | 4(e)(16) | ||||
4(e)(19) | Officer’s Certificate dated February 6, 2004 setting forth the form, terms and provisions of the Fourteenth Series of General Mortgage Bonds | CenterPoint Energy’s Form 10-K for the year ended December 31, 2005 | 1-31447 | 4(e)(17) |
4(e)(20) | Fourteenth Supplemental Indenture to Exhibit 4(e)(1), dated as of February 11, 2004 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2005 | 1-31447 | 4(e)(18) | ||||
4(e)(21) | Officer’s Certificate dated February 11, 2004 setting forth the form, terms and provisions of the Fifteenth Series of General Mortgage Bonds | CenterPoint Energy’s Form 10-K for the year ended December 31, 2005 | 1-31447 | 4(e)(19) | ||||
4(e)(22) | Fifteenth Supplemental Indenture to Exhibit 4(e)(1), dated as of March 31, 2004 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2005 | 1-31447 | 4(e)(20) | ||||
4(e)(23) | Officer’s Certificate dated March 31, 2004 setting forth the form, terms and provisions of the Sixteenth Series of General Mortgage Bonds | CenterPoint Energy’s Form 10-K for the year ended December 31, 2005 | 1-31447 | 4(e)(21) | ||||
4(e)(24) | Sixteenth Supplemental Indenture to Exhibit 4(e)(1), dated as of March 31, 2004 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2005 | 1-31447 | 4(e)(22) | ||||
4(e)(25) | Officer’s Certificate dated March 31, 2004 setting forth the form, terms and provisions of the Seventeenth Series of General Mortgage Bonds | CenterPoint Energy’s Form 10-K for the year ended December 31, 2005 | 1-31447 | 4(e)(23) | ||||
4(e)(26) | Seventeenth Supplemental Indenture to Exhibit 4(e)(1), dated as of March 31, 2004 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2005 | 1-31447 | 4(e)(24) | ||||
4(e)(27) | Officer’s Certificate dated March 31, 2004 setting forth the form, terms and provisions of the Eighteenth Series of General Mortgage Bonds | CenterPoint Energy’s Form 10-K for the year ended December 31, 2005 | 1-31447 | 4(e)(25) | ||||
4(e)(28) | Nineteenth Supplemental Indenture to Exhibit 4(e)(1), dated as of November 26, 2008 | CenterPoint Energy’s Form 8-K dated November 25, 2008 | 1-31447 | 4.2 | ||||
4(e)(29) | Officer’s Certificate date November 26, 2008 setting forth the form, terms and provisions of the Twentieth Series of General Mortgage Bonds | CenterPoint Energy’s Form 8-K dated November 25, 2008 | 1-31447 | 4.3 | ||||
4(e)(30) | Twentieth Supplemental Indenture to Exhibit 4(e)(1), dated as of December 9, 2008 | CenterPoint Houston’s Form 8-K dated January 6, 2009 | 1-3187 | 4.2 | ||||
4(e)(31) | Twenty-First Supplemental Indenture to Exhibit 4(e)(1), dated as of January 9, 2009 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2008 | 1-31447 | 4(e)(31) | ||||
4(e)(32) | Officer’s Certificate date January 20, 2009 setting forth the form, terms and provisions of the Twenty-First Series of General Mortgage Bonds | CenterPoint Energy’s Form 10-K for the year ended December 31, 2008 | 1-31447 | 4(e)(32) |
4(f)(1) | Indenture, dated as of February 1, 1998, between Reliant Energy Resources Corp. | CERC Corp.’s Form 8-K dated February 5, 1998 | 1-13265 | 4.1 | ||||
4(f)(2) | Supplemental Indenture No. 1 to Exhibit 4(f)(1), dated as of February 1, 1998, providing for the issuance of RERC Corp.’s 6 1/2% Debentures due February 1, 2008 | CERC Corp.’s Form 8-K dated November 9, 1998 | 1-13265 | 4.2 | ||||
4(f)(3) | Supplemental Indenture No. 2 to Exhibit 4(f)(1), dated as of November 1, 1998, providing for the issuance of RERC Corp.’s 6 3/8% Term Enhanced ReMarketable Securities | CERC Corp.’s Form 8-K dated November 9, 1998 | 1-13265 | 4.1 | ||||
4(f)(4) | Supplemental Indenture No. 3 to Exhibit 4(f)(1), dated as of July 1, 2000, providing for the issuance of RERC Corp.’s 8.125% Notes due 2005 | CERC Corp.’s Registration Statement on Form S-4 | 333-49162 | 4.2 | ||||
4(f)(5) | Supplemental Indenture No. 4 to Exhibit 4(f)(1), dated as of February 15, 2001, providing for the issuance of RERC Corp.’s 7.75% Notes due 2011 | CERC Corp.’s Form 8-K dated February 21, 2001 | 1-13265 | 4.1 | ||||
4(f)(6) | Supplemental Indenture No. 5 to Exhibit 4(f)(1), dated as of March 25, 2003, providing for the issuance of CenterPoint Energy Resources Corp.’s | CenterPoint Energy’s Form 8-K dated March 18, 2003 | 1-31447 | 4.1 | ||||
4(f)(7) | Supplemental Indenture No. 6 to Exhibit 4(f)(1), dated as of April 14, 2003, providing for the issuance of CERC Corp.’s 7.875% Senior Notes due 2013 | CenterPoint Energy’s Form 8-K dated April 7, 2003 | 1-31447 | 4.2 | ||||
4(f)(8) | Supplemental Indenture No. 7 to Exhibit 4(f)(1), dated as of November 3, 2003, providing for the issuance of CERC Corp.’s 5.95% Senior Notes due 2014 | CenterPoint Energy’s Form 8-K dated October 29, 2003 | 1-31447 | 4.2 | ||||
4(f)(9) | Supplemental Indenture No. 8 to Exhibit 4(f)(1), dated as of December 28, 2005, providing for a modification of CERC Corp.’s 6 1/2% Debentures due 2008 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2005 | 1-31447 | 4(f)(9) | ||||
4(f)(10) | Supplemental Indenture No. 9 to Exhibit 4(f)(1), dated as of May 18, 2006, providing for the issuance of CERC Corp.’s 6.15% Senior Notes due 2016 | CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2006 | 1-31447 | 4.7 |
4(f)(11) | Supplemental Indenture No. 10 to Exhibit 4(f)(1), dated as of February 6, 2007, providing for the issuance of CERC Corp.’s 6.25% Senior Notes due 2037 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2006 | 1-31447 | 4(f)(11) | ||||
4(f)(12) | Supplemental Indenture No. 11 to Exhibit 4(f)(1) dated as of October 23, 2007, providing for the issuance of CERC Corp.’s 6.125% Senior Notes due 2017 | CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2007 | 1-31447 | 4.8 | ||||
4(f)(13) | Supplemental Indenture No. 12 to Exhibit 4(f)(1) dated as of October 23, 2007, providing for the issuance of CERC Corp.’s 6.625% Senior Notes due 2037 | CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2008 | 1-31447 | 4.9 | ||||
4(f)(14) | Supplemental Indenture No. 13 to Exhibit 4(f)(1) dated as of May 15, 2008, providing for the issuance of CERC Corp.’s 6.00% Senior Notes due 2018 | CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2008 | 1-31447 | 4.9 | ||||
†4(f)(15) | — | Supplemental Indenture No. 14 to Exhibit 4(f)(1) dated as of January 11, 2011, providing for the issuance of CERC Corp.’s 4.50% Senior Notes due 2021 and 5.85% Senior Notes due 2041 | ||||||
†4(f)(16) | — | Supplemental Indenture No. 15 to Exhibit 4(f)(1) dated as of January 20, 2011, providing for the issuance of CERC Corp.’s 4.50% Senior Notes due 2021 | ||||||
4(g)(1) | Indenture, dated as of May 19, 2003, between CenterPoint Energy and JPMorgan Chase Bank, as Trustee | CenterPoint Energy’s Form 8-K dated May 19, 2003 | 1-31447 | 4.1 | ||||
4(g)(2) | Supplemental Indenture No. 1 to Exhibit 4(g)(1), dated as of May 19, 2003, providing for the issuance of CenterPoint Energy’s 3.75% Convertible Senior Notes due 2023 | CenterPoint Energy’s Form 8-K dated May 19, 2003 | 1-31447 | 4.2 | ||||
4(g)(3) | Supplemental Indenture No. 2 to Exhibit 4(g)(1), dated as of May 27, 2003, providing for the issuance of CenterPoint Energy’s 5.875% Senior Notes due 2008 and 6.85% Senior Notes due 2015 | CenterPoint Energy’s Form 8-K dated May 19, 2003 | 1-31447 | �� | 4.3 | |||
4(g)(4) | Supplemental Indenture No. 3 to Exhibit 4(g)(1), dated as of September 9, 2003, providing for the issuance of CenterPoint Energy’s 7.25% Senior Notes due 2010 | CenterPoint Energy’s Form 8-K dated September 9, 2003 | 1-31447 | 4.2 | ||||
4(g)(5) | Supplemental Indenture No. 4 to Exhibit 4(g)(1), dated as of December 17, 2003, providing for the issuance of CenterPoint Energy’s 2.875% Convertible Senior Notes due 2024 | CenterPoint Energy’s Form 8-K dated December 10, 2003 | 1-31447 | 4.2 |
4(g)(6) | Supplemental Indenture No. 5 to Exhibit 4(g)(1), dated as of December 13, 2004, as supplemented by Exhibit 4(g)(5), relating to the issuance of CenterPoint Energy’s 2.875% Convertible Senior Notes due 2024 | CenterPoint Energy’s Form 8-K dated December 9, 2004 | 1-31447 | 4.1 |
4(g)(7) | Supplemental Indenture No. 6 to Exhibit 4(g)(1), dated as of August 23, 2005, providing for the issuance of CenterPoint Energy’s 3.75% Convertible Senior Notes, Series B due 2023 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2005 | 1-31447 | 4(g)(7) | ||||
4(g)(8) | Supplemental Indenture No. 7 to Exhibit 4(g)(1), dated as of February 6, 2007, providing for the issuance of CenterPoint Energy’s 5.95% Senior Notes due 2017 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2006 | 1-31447 | 4(g)(8) | ||||
4(g)(9) | Supplemental Indenture No. 8 to Exhibit 4(g)(1), dated as of May 5, 2008, providing for the issuance of CenterPoint Energy’s 6.50% Senior Notes due 2018 | CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2008 | 1-31447 | 4.7 | ||||
4(h)(1) | Subordinated Indenture dated as of September 1, 1999 | Reliant Energy’s Form 8-K dated September 1, 1999 | 1-3187 | 4.1 | ||||
4(h)(2) | Supplemental Indenture No. 1 dated as of September 1, 1999, between Reliant Energy and Chase Bank of Texas (supplementing Exhibit 4(h)(1) and providing for the issuance Reliant Energy’s 2% Zero-Premium Exchangeable Subordinated Notes Due 2029) | Reliant Energy’s Form 8-K dated September 15, 1999 | 1-3187 | 4.2 | ||||
4(h)(3) | Supplemental Indenture No. 2 dated as of August 31, 2002, between CenterPoint Energy, Reliant Energy and JPMorgan Chase Bank (supplementing Exhibit 4(h)(1)) | CenterPoint Energy’s Form 8-K12B dated August 31, 2002 | 1-31447 | 4(e) | ||||
4(h)(4) | Supplemental Indenture No. 3 dated as of December 28, 2005, between CenterPoint Energy, Reliant Energy and JPMorgan Chase Bank (supplementing Exhibit 4(h)(1)) | CenterPoint Energy’s Form 10-K for the year ended December 31, 2005 | 1-31447 | 4(h)(4) | ||||
4(i)(1) | $1,200,000,000 Second Amended and Restated Credit Agreement dated as of June 29, 2007, among CenterPoint Energy, as Borrower, and the banks named therein | CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2007 | 1-31447 | 4.3 | ||||
4(i)(2) | First Amendment to Exhibit 4(i)(1), dated as of August 20, 2008, among CenterPoint Energy, as Borrower, and the banks named therein | CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2008 | 1-31447 | 4.4 |
4(i)(3) | Second Amendment to Exhibit 4(i)(1), dated as of November 18, 2008, among CenterPoint Energy, as Borrower, and the banks named therein | CenterPoint Energy’s Form 8-K dated November 18, 2008 | 1-31447 | 4.1 |
4(i)(4) | Third Amendment to Exhibit 4(i)(1), dated as of February 5, 2010, among CenterPoint Energy, as Borrower, and the banks named therein | CenterPoint Energy’s Form 8-K dated February 5, 2010 | 1-31447 | 4.1 | ||||
4(j)(1) | $300,000,000 Second Amended and Restated Credit Agreement dated as of June 29, 2007, among CenterPoint Houston, as Borrower, and the banks named therein | CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2007 | 1-31447 | 4.4 | ||||
4(j)(2) | First Amendment to Exhibit 4(j)(1), dated as of November 18, 2008, among CenterPoint Houston, as Borrower, and the banks named therein | CenterPoint Energy’s Form 8-K dated November 18, 2008 | 1-31447 | 4.2 | ||||
4(k) | $950,000,000 Second Amended and Restated Credit Agreement dated as of June 29, 2007, among CERC Corp., as Borrower, and the banks named therein | CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2007 | 1-31447 | 4.5 | ||||
4(l) | $600,000,000 Credit Agreement dated as of November 25, 2008, among CenterPoint Houston, as Borrower, and the banks named therein | CenterPoint Energy’s Form 8-K dated November 25, 2008 | 1-31447 | 4.1 |
Exhibit Number | Description | Report or Registration Statement | SEC File or Registration Number | Exhibit Reference | ||||
*10(a) | CenterPoint Energy Executive Benefits Plan, as amended and restated effective June 18, 2003 | CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2003 | 1-31447 | 10.4 | ||||
*10(b)(1) | Executive Incentive Compensation Plan of Houston Industries Incorporated | HI’s Form 10-K for the year ended December 31, 1991 | 1-7629 | 10(b) | ||||
*10(b)(2) | First Amendment to Exhibit 10(b)(1) effective as of March 30, 1992 | HI’s Form 10-Q for the quarter ended March 31, 1992 | 1-7629 | 10(a) | ||||
*10(b)(3) | Second Amendment to Exhibit 10(b)(1) effective as of November 4, 1992 | HI’s Form 10-K for the year ended December 31, 1992 | 1-7629 | 10(b) | ||||
*10(b)(4) | Third Amendment to Exhibit 10(b)(1) effective as of September 7, 1994 | HI’s Form 10-K for the year ended December 31, 1994 | 1-7629 | 10(b)(4) |
*10(b)(5) | Fourth Amendment to Exhibit 10(b)(1) effective as of August 6, 1997 | HI’s Form 10-K for the year ended December 31, 1997 | 1-3187 | 10(b)(5) |
*10(c)(1) | Executive Incentive Compensation Plan of HI as amended and restated on January 1, 1991 | HI’s Form 10-K for the year ended December 31, 1990 | 1-7629 | 10(b) | ||||
*10(c)(2) | First Amendment to Exhibit 10(c)(1) effective as of January 1, 1991 | HI’s Form 10-K for the year ended December 31, 1991 | 1-7629 | 10(f)(2) | ||||
*10(c)(3) | Second Amendment to Exhibit 10(c)(1) effective as of March 30, 1992 | HI’s Form 10-Q for the quarter ended March 31, 1992 | 1-7629 | 10(d) | ||||
*10(c)(4) | Third Amendment to Exhibit 10(c)(1) effective as of November 4, 1992 | HI’s Form 10-K for the year ended December 31, 1992 | 1-7629 | 10(f)(4) | ||||
*10(c)(5) | Fourth Amendment to Exhibit 10(c)(1) effective as of January 1, 1993 | HI’s Form 10-K for the year ended December 31, 1992 | 1-7629 | 10(f)(5) | ||||
*10(c)(6) | Fifth Amendment to Exhibit 10(c)(1) effective in part, January 1, 1995, and in part, September 7, 1994 | HI’s Form 10-K for the year ended December 31, 1994 | 1-7629 | 10(f)(6) | ||||
*10(c)(7) | Sixth Amendment to Exhibit 10(c)(1) effective as of August 1, 1995 | HI’s Form 10-Q for the quarter ended June 30, 1995 | 1-7629 | 10(a) | ||||
*10(c)(8) | Seventh Amendment to Exhibit 10(c)(1) effective as of January 1, 1996 | HI’s Form 10-Q for the quarter ended June 30, 1996 | 1-7629 | 10(a) | ||||
*10(c)(9) | Eighth Amendment to Exhibit 10(c)(1) effective as of January 1, 1997 | HI’s Form 10-Q for the quarter ended June 30, 1997 | 1-7629 | 10(a) | ||||
*10(c)(10) | Ninth Amendment to Exhibit 10(c)(1) effective in part, January 1, 1997, and in part, January 1, 1998 | HI’s Form 10-K for the year ended December 31, 1997 | 1-3187 | 10(f)(10) | ||||
*10(d) | Benefit Restoration Plan of HI effective as of June 1, 1985 | HI’s Form 10-Q for the quarter ended March 31, 1987 | 1-7629 | 10(c) | ||||
*10(e) | Benefit Restoration Plan of HI as amended and restated effective as of January 1, 1988 | HI’s Form 10-K for the year ended December 31, 1991 | 1-7629 | 10(g)(2) | ||||
*10(f)(1) | Benefit Restoration Plan of HI, as amended and restated effective as of July 1, 1991 | HI’s Form 10-K for the year ended December 31, 1991 | 1-7629 | 10(g)(3) |
*10(f)(2) | First Amendment to Exhibit 10(f)(1) effective in part, August 6, 1997, in part, September 3, 1997, and in part, October 1, 1997 | HI’s Form 10-K for the year ended December 31, 1997 | 1-3187 | 10(i)(2) |
*10(f)(3) | Third Amendment to Exhibit 10(f)(1) effective as of January 1, 2008 | CenterPoint Energy’s Form 8-K dated December 22, 2008 | 1-31447 | 10.2 | ||||
*10(g) | CenterPoint Energy Benefit Restoration Plan, effective as of January 1, 2008 | CenterPoint Energy’s Form 8-K dated December 22, 2008 | 1-31447 | 10.1 | ||||
*10(h)(1) | HI 1995 Section 415 Benefit Restoration Plan effective August 1, 1995 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2008 | 1-31447 | 10(h)(1) | ||||
*10(h)(2) | First Amendment to Exhibit 10(h)(1) effective as of August 1, 1995 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2008 | 1-31447 | 10(h)(2) | ||||
*10(i) | CenterPoint Energy 1985 Deferred Compensation Plan, as amended and restated effective January 1, 2003 | CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2003 | 1-31447 | 10.1 | ||||
*10(j)(1) | Reliant Energy 1994 Long- Term Incentive Compensation Plan, as amended and restated effective January 1, 2001 | Reliant Energy’s Form 10-Q for the quarter ended June 30, 2002 | 1-3187 | 10.6 | ||||
*10(j)(2) | First Amendment to Exhibit 10(j)(1), effective December 1, 2003 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2003 | 1-31447 | 10(p)(7) | ||||
*10(j)(3) | Form of Non-Qualified Stock Option Award Notice under Exhibit 10(i)(1) | CenterPoint Energy’s Form 8-K dated January 25, 2005 | 1-31447 | 10.6 | ||||
*10(k)(1) | Savings Restoration Plan of HI effective as of January 1, 1991 | HI’s Form 10-K for the year ended December 31, 1990 | 1-7629 | 10(f) | ||||
*10(k)(2) | First Amendment to Exhibit 10(k)(1) effective as of January 1, 1992 | HI’s Form 10-K for the year ended December 31, 1991 | 1-7629 | 10(l)(2) | ||||
*10(k)(3) | Second Amendment to Exhibit 10(k)(1) effective in part, August 6, 1997, and in part, October 1, 1997 | HI’s Form 10-K for the year ended December 31, 1997 | 1-3187 | 10(q)(3) | ||||
*10(l)(3) | Amended and Restated CenterPoint Energy, Inc. 1991 Savings Restoration Plan, effective as of January 1, 2008 | CenterPoint Energy’s Form 8-K dated December 22, 2008 | 1-31447 | 10.4 | ||||
*10(m) | CenterPoint Energy Savings Restoration Plan, effective as of January 1, 2008 | CenterPoint Energy’s Form 8-K dated December 22, 2008 | 1-31447 | 10.3 |
*10(n)(1) | CenterPoint Energy Outside Director Benefits Plan, as amended and restated effective June 18, 2003 | CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2003 | 1-31447 | 10.6 |
*10(n)(2) | First Amendment to Exhibit 10(n)(1) effective as of January 1, 2004 | CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2004 | 1-31447 | 10.6 | ||||
*10(n)(3) | CenterPoint Energy Outside Director Benefits Plan, as amended and restated effective December 31, 2008 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2008 | 1-31447 | 10(n)(3) | ||||
*10(o) | CenterPoint Energy Executive Life Insurance Plan, as amended and restated effective June 18, 2003 | CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2003 | 1-31447 | 10.5 | ||||
*10(p) | Employment and Supplemental Benefits Agreement between HL&P and Hugh Rice Kelly | HI’s Form 10-Q for the quarter ended March 31, 1987 | 1-7629 | 10(f) | ||||
10(q)(1) | Stockholder’s Agreement dated as of July 6, 1995 between Houston Industries Incorporated and Time Warner Inc. | Schedule 13-D dated July 6, 1995 | 5-19351 | 2 | ||||
10(q)(2) | Amendment to Exhibit 10(q)(1) dated November 18, 1996 | HI’s Form 10-K for the year ended December 31, 1996 | 1-7629 | 10(x)(4) | ||||
*10(r)(1) | Houston Industries Incorporated Executive Deferred Compensation Trust effective as of December 19, 1995 | HI’s Form 10-K for the year ended December 31, 1995 | 1-7629 | 10(7) | ||||
*10(r)(2) | First Amendment to Exhibit 10(r)(1) effective as of August 6, 1997 | HI’s Form 10-Q for the quarter ended June 30, 1998 | 1-3187 | 10 | ||||
*10(s) | Letter Agreement dated May 24, 2007 between CenterPoint Energy and Milton Carroll, Non-Executive Chairman of the Board of Directors of CenterPoint Energy | CenterPoint Energy’s Form 8-K dated May 31, 2007 | 1-31447 | 10.1 | ||||
*10(t) | Reliant Energy, Incorporated and Subsidiaries Common Stock Participation Plan for Designated New Employees and Non-Officer Employees, as amended and restated effective January 1, 2001 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2002 | 1-31447 | 10(y)(2) | ||||
*10(u)(1) | Long-Term Incentive Plan of CenterPoint Energy, Inc. (amended and restated effective as of May 1, 2004) | CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2004 | 1-31447 | 10.5 | ||||
*10(u)(2) | First Amendment to Exhibit (u)(1), effective January 1, 2007 | CenterPoint Energy’s Form 10-Q for the quarter ended March 31, 2007 | 1-31447 | 10.5 |
*10(u)(3) | Form of Non-Qualified Stock Option Award Agreement under Exhibit 10(u)(1) | CenterPoint Energy’s Form 8-K dated January 25, 2005 | 1-31447 | 10.1 |
*10(u)(4) | Form of Restricted Stock Award Agreement under Exhibit 10(u)(1) | CenterPoint Energy’s Form 8-K dated January 25, 2005 | 1-31447 | 10.2 | ||||
*10(u)(5) | Form of Performance Share Award under Exhibit 10(u)(1) | CenterPoint Energy’s Form 8-K dated January 25, 2005 | 1-31447 | 10.3 | ||||
*10(u)(6) | Form of Performance Share Award Agreement for 20XX-20XX Performance Cycle under Exhibit | CenterPoint Energy’s Form 8-K dated February 22, 2006 | 1-31447 | 10.2 | ||||
*10(u)(7) | Form of Restricted Stock Award Agreement (With Performance Vesting Requirement) under Exhibit 10(u)(1) | CenterPoint Energy’s Form 8-K dated February 21, 2005 | 1-31447 | 10.2 | ||||
*10(u) | Form of Stock Award Agreement (With Performance Goal) under Exhibit 10(u)(1) | CenterPoint Energy’s Form 8-K dated February 22, 2006 | 1-31447 | 10.3 | ||||
*10(u)(9) | Form of Performance Share Award Agreement for 20XX | CenterPoint Energy’s Form 8-K dated February 21, 2007 | 1-31447 | 10.1 | ||||
*10(u)(10) | Form of Stock Award Agreement (With Performance Goal) under Exhibit 10(u)(1) | CenterPoint Energy’s Form 8-K dated February 21, 2007 | 1-31447 | 10.2 | ||||
*10(u)(11) | Form of Stock Award Agreement (Without Performance Goal) under Exhibit | CenterPoint Energy’s Form 8-K dated February 21, 2007 | 1-31447 | 10.3 | ||||
*10(u)(12) | Form of Performance Share Award Agreement for 20XX | CenterPoint Energy’s Form 8-K dated February 20, 2008 | 1-31447 | 10.1 | ||||
*10(u)(13) | Form of Stock Award Agreement (With Performance Goal) under Exhibit 10(u)(1) | CenterPoint Energy’s Form 8-K dated February 20, 2008 | 1-31447 | 10.2 | ||||
10(v)(1) | Master Separation Agreement entered into as of December 31, 2000 between Reliant Energy, Incorporated and Reliant Resources, Inc. | Reliant Energy’s Form 10-Q for the quarter ended March 31, 2001 | 1-3187 | 10.1 | ||||
10(v)(2) | First Amendment to Exhibit 10(v)(1) effective as of February 1, 2003 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2002 | 1-31447 | 10(bb)(5) | ||||
10(v)(3) | Employee Matters Agreement, entered into as of December 31, 2000, between Reliant Energy, Incorporated and Reliant Resources, Inc. | Reliant Energy’s Form 10-Q for the quarter ended March 31, 2001 | 1-3187 | 10.5 |
10(v)(4) | Retail Agreement, entered into as of December 31, 2000, between Reliant Energy, Incorporated and Reliant Resources, Inc. | Reliant Energy’s Form 10-Q for the quarter ended March 31, 2001 | 1-3187 | 10.6 | ||||
10(v)(5) | Tax Allocation Agreement, entered into as of December 31, 2000, between Reliant Energy, Incorporated and Reliant Resources, Inc. | Reliant Energy’s Form 10-Q for the quarter ended March 31, 2001 | 1-3187 | 10.8 | ||||
10(w)(1) | Separation Agreement entered into as of August 31, 2002 between CenterPoint Energy and Texas Genco | CenterPoint Energy’s Form 10-K for the year ended December 31, 2002 | 1-31447 | 10(cc)(1) | ||||
10(w)(2) | Transition Services Agreement, dated as of August 31, 2002, between CenterPoint Energy and Texas Genco | CenterPoint Energy’s Form 10-K for the year ended December 31, 2002 | 1-31447 | 10(cc)(2) | ||||
10(w)(3) | Tax Allocation Agreement, dated as of August 31, 2002, between CenterPoint Energy and Texas Genco | CenterPoint Energy’s Form 10-K for the year ended December 31, 2002 | 1-31447 | 10(cc)(3) | ||||
*10(x) | Retention Agreement effective October 15, 2001 between Reliant Energy and David G. Tees | Reliant Energy’s Form 10-K for the year ended December 31, 2001 | 1-3187 | 10(jj) | ||||
*10(y) | Retention Agreement effective October 15, 2001 between Reliant Energy and Michael A. Reed | Reliant Energy’s Form 10-K for the year ended December 31, 2001 | 1-3187 | 10(kk) | ||||
*10(z) | Non-Qualified Unfunded Executive Supplemental Income Retirement Plan of Arkla, Inc. effective as of August 1, 1983 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2002 | 1-31447 | 10(gg) | ||||
*10(aa)(1) | Deferred Compensation Plan for Directors of Arkla, Inc. effective as of November 10, 1988 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2002 | 1-31447 | 10(hh)(1) | ||||
*10(aa)(2) | First Amendment to Exhibit 10(aa)(1) effective as of August 6, 1997 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2002 | 1-31447 | 10(hh)(2) | ||||
*10(bb)(1) | CenterPoint Energy, Inc. Deferred Compensation Plan, as amended and restated effective January 1, 2003 | CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2003 | 1-31447 | 10.2 | ||||
*10(bb)(2) | First Amendment to Exhibit 10(bb)(1) effective as of January 1, 2008 | CenterPoint Energy’s Form 8-K dated February 20, 2008 | 1-31447 | 10.4 | ||||
*10(bb)(3) | CenterPoint Energy 2005 Deferred Compensation Plan, effective January 1, 2008 | CenterPoint Energy’s Form 8-K dated February 20, 2008 | 1-31447 | 10.3 |
*10(bb)(4) | Amended and Restated CenterPoint Energy 2005 Deferred Compensation Plan, effective January 1, 2009 | CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2008 | 1-31447 | 10.1 | ||||
*10(cc)(1) | CenterPoint Energy Short Term Incentive Plan, as amended and restated effective January 1, 2003 | CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2003 | 1-31447 | 10.3 | ||||
*10(cc)(2) | Second Amendment to Exhibit 10(cc)(1) | CenterPoint Energy’s Form 8-K dated December 10, 2009 | 1-31447 | 10.1 | ||||
*10(dd)(1) | CenterPoint Energy Stock Plan for Outside Directors, as amended and restated effective May 7, 2003 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2003 | 1-31447 | 10(ll) | ||||
First Amendment to Exhibit 10(dd)(1) | CenterPoint Energy’s Form 10-Q for the quarter ended March 31, 2010 | 1-31447 | 10.2 | |||||
10(ee) | — | City of Houston Franchise Ordinance | CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2005 | 1-31447 | 10.1 | |||
10(ff) | Letter Agreement dated March 16, 2006 between CenterPoint Energy and John T. Cater | CenterPoint Energy’s Form 10-Q for the quarter ended March 30, 2006 | 1-31447 | 10 | ||||
10(gg)(1) | Amended and Restated HL&P Executive Incentive Compensation Plan effective as of January 1, 1985 | CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2008 | 1-31447 | 10.2 | ||||
10(gg)(2) | First Amendment to Exhibit 10(gg)(1) effective as of January 1, 2008 | CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2008 | 1-31447 | 10.3 | ||||
*10(hh)(1) | Executive Benefits Agreement by and between HL&P and Thomas R. Standish effective August 20, 1993 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2008 | 1-31447 | 10(hh)(1) | ||||
*10(hh)(2) | First Amendment to Exhibit 10(hh)(1) effective as of December 31, 2008 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2008 | 1-31447 | 10(hh)(2) | ||||
*10(ii)(1) | Executive Benefits Agreement by and between HL&P and David M. McClanahan effective August 24, 1993 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2008 | 1-31447 | 10(ii)(1) | ||||
*10(ii)(2) | First Amendment to Exhibit 10(ii)(1) effective as of December 31, 2008 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2008 | 1-31447 | 10(ii)(2) | ||||
*10(jj)(1) | Executive Benefits Agreement by and between HL&P and Joseph B. McGoldrick effective August 30, 1993 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2008 | 1-31447 | 10(jj)(1) |
*10(jj)(2) | First Amendment to Exhibit 10(jj)(1) effective as of December 31, 2008 | CenterPoint Energy’s Form 10-K for the year ended December 31, 2008 | 1-31447 | 10(jj)(2) |
*10(kk)(1) | CenterPoint Energy, Inc. 2009 Long Term Incentive Plan | CenterPoint Energy’s Schedule 14A dated March 13, 2009 | 1-31447 | A | ||||
CenterPoint Energy’s Form 10-K for the year ended December 31, 2009 | 1-31447 | 10(kk)(2) | ||||||
CenterPoint Energy’s Form 10-K for the year ended December 31, 2009 | 1-31447 | 10(kk)(3) | ||||||
†10(ll) | ||||||||
†10(mm) | ||||||||
10(nn) | Form of Executive Officer Change in Control Agreement | CenterPoint Energy’s Form 10-K for the year ended December 31, 2008 | 1-31447 | 10(nn) | ||||
10(oo) | Form of Corporate Officer Change in Control Agreement | CenterPoint Energy’s Form 10-K for the year ended December 31, 2008 | 1-31447 | 10(oo) | ||||
†12 | ||||||||
†21 | ||||||||
†23 | ||||||||
†31.1 | ||||||||
†31.2 | ||||||||
†32.1 | ||||||||
†32.2 | ||||||||