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TVA Starts Fiscal 2018 with Solid First Quarter Results

THIS POST WAS ORIGINALLY PUBLISHED ON THIS SITE Click Here To Read Entire Article

KNOXVILLE, Tenn., Feb. 2, 2018 /PRNewswire/ — The Tennessee Valley Authority reported today in its FY18 first quarter financial disclosure a net income of $288 million for the three months ended Dec. 31, 2017. Net income was up $186 million from the same period last year, primarily due to overall lower expenses.

TVA’s total operating revenues of approximately $2.5 billion for the three months ending Dec. 31, 2017, were relatively flat when compared to first quarter last year. Power sales were up about two percent for the quarter on more normal weather, as milder weather affected sales during the same period last year. Even with higher sales volume, fuel and purchased power expenses were down $115 million, or about 14 percent, primarily due to an increase in low-cost hydroelectric production and slightly lower natural gas prices.        

“Power consumers in the Tennessee Valley are seeing significant benefits from the investments we’ve made to diversify TVA’s power system,” said TVA Chief Executive Officer Bill Johnson. “More than half of the energy supplied by TVA in the first quarter came from carbon-free sources – nuclear, hydro and other renewables that are helping the power system deliver safe, reliable, and cleaner energy – at a lower cost. 

“TVA’s residential rates are lower than 70 percent of our competitors,” Johnson said. “As a result of reductions in O&M, improved operations and lower fuel costs, the effective rate for consumers is 2 percent below 2013.”

With more normal rainfall, TVA was able to increase hydroelectric generation in the first quarter, which accounted for about nine percent of total power supply, versus only five percent during the same period last year. Natural gas-fired generation also increased by about 13 percent during the first three months of FY18, compared to the same period of the prior year. This was partially driven by the slightly lower natural gas prices.

Operating and maintenance expense was $32 million lower for first quarter FY18 compared to FY17. The decrease was partially due to fewer planned nuclear outage days and lower expenses related to identified efficiencies and staffing changes.   

“TVA customers are seeing the benefits of lower costs from each of our major expense categories – lower fuel and purchased power expense, greater efficiency in how we operate and declining interest on debt,” said TVA Chief Financial Officer John Thomas. “The significant improvements in TVA’s power system and operations over the last few years are keeping TVA’s power rates low, while improving TVA’s financial health for the future.”

Additional highlights of TVA’s first quarter fiscal year 2018 results include:

  • Increased revenue from higher energy sales and the base rate adjustment that became effective Oct. 1, 2017, was offset by lower fuel cost recovery.
  • Total operating expenses decreased approximately eight percent during the first quarter of 2018 as compared to the same period of the prior year.
  • During the first quarter of 2018, TVA completed installations of two selective catalytic reduction systems at the Gallatin Fossil Plant, as well as the installation of scrubbers and SCRs for Units 1 and 4 at the Shawnee Fossil Plant.
  • Units 1-4 of the Johnsonville Fossil Plant were retired in December 2017.

Selected Financial Data

For the Quarter Ended December 31

Sales, Revenues & Expenses

2017

2016

Sales (millions of kWh)

37,283

36,497

Operating Revenues ($ millions)

$    2,549

$    2,546

Fuel & Purchased Power

695

810

Operating & Maintenance

709

741

Interest Expense

322

339

Net Income

$       288

$       102

Net Cash Provided by / (Used in)

 ($ millions)

2017

2016

Operating Activities

$       613

$       617

Investing Activities

(628)

(707)

Financing Activities

15

90

Net Change in Cash & Cash Equivalents

TVA executive management will host a conference call to discuss first quarter fiscal year 2018 results at 9:30 a.m. EST, on Friday, Feb. 2, 2018. The conference call can be accessed from TVA’s website via webcast, at http://www.tva.com, on the Investor Relations home page. For quicker access to the live conference call, please pre-register through TVA’s website before the scheduled start time, and follow the instructions provided. Once pre-registered, the dial-in number will be provided via an email. If you are unable to pre-register, you may access the conference call by dialing toll free (844) 308-6432 in the United States, or (412) 717- 9611 outside the United States.

A replay will be available one hour after the end of the conference call until 9:30 a.m. ET, Feb. 2, 2019, by calling toll free (877) 344-7529 in the United States or (412) 317-0088 outside the United States and using the conference number 10115229. A webcast replay and transcript will also be available for one year on TVA’s website at http://www.tva.com/investors.

TVA’s quarterly report on Form 10-Q provides additional financial, operational and descriptive information, including unaudited financial statements for the quarter ended Dec. 31, 2017. TVA’s quarterly report and other SEC reports are available without charge on TVA’s website at http://www.tva.com/investors, on the SEC’s website at http://www.sec.gov or by calling TVA toll free at (888) 882-4975.

This release may contain forward-looking statements relating to future events and future performance. Although TVA believes that the assumptions underlying these statements are reasonable, numerous factors could cause actual results to differ materially from those in the forward-looking statements. Please refer to TVA’s most recent annual report on Form 10-K and quarterly report on Form 10-Q for a discussion of factors that could cause actual results to differ from those in the forward-looking statements.

The Tennessee Valley Authority is a corporate agency of the United States that provides electricity for business customers and local power companies serving more than 9 million people in parts of seven southeastern states. TVA receives no taxpayer funding, deriving virtually all of its revenues from sales of electricity. In addition to operating and investing its revenues in its electric system, TVA provides flood control, navigation and land management for the Tennessee River system and assists local power companies and state and local governments with economic development and job creation.

Media Contact:   

Gail Rymer, Knoxville, 865-632-2911

TVA Public Relations, Knoxville, 865-632-6000

www.tva.com/news

Follow TVA news on Facebook and Twitter

Investor Relations: 

Tammy Wilson, Knoxville, 865-632-3366 or 888-882-4975

Josh Carlon, Knoxville, 865-632-4133 or 888-882-4975

http://www.tva.com/investors           

Cision View original content with multimedia:http://www.prnewswire.com/news-releases/tva-starts-fiscal-2018-with-solid-first-quarter-results-300592570.html

SOURCE Tennessee Valley Authority

Related Links

http://www.tva.com

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